Question

Over the last fifteen years, the price of cell phones and land lines has changed tremendously.  Using the supply and demand model of price determination, explain these trends.  To backup your answer, please find a page on the internet that talks about these changes and share the findings with us. Also please draw a supply and demand graph.  Then show how recent changes have caused the price of cell phones to change.

Answer 1

Market for cell phones

The demand for cellphones has risen a lot during the past few years.It has become a necessity for people to carry cellphones.Supply has also risen due to advancement in technology.But demand has risen more so pruce has also risen.

Cellphones and landlines are substitutes.The demand for landlines have fallen because demand for cellphones have risen.Supply has also fallen because producers are producing more cellphones.So price has fallen.