Determine what type of model best fits the given situation: An Internet phone company presently provides service to 5,000 customers at a monthly rate of $20 per month. After a market survey, it was determined that for each $1 decrease in the monthly rate an increase of 500 new customers would result. A. linear B. quadratic C. none of these D. exponential

The best fit is A. Linear model

Step-by-step explanation:

Given:

Monthly Rate = $20, Number of customers = 5000

If there is a decrease of $1 in the monthly rate, the number of customers increase by 500.

To find:

The type of model that best fits the given situation?

Solution:

Monthly Rate = $20, Number of customers = 5000

Let us decrease the monthly rate by $1.

Monthly Rate = $20 - $1  = $19, Number of customers = 5000 + 500 = 5500

Let us decrease the monthly rate by $1 more.

Monthly Rate = $19 - $1  = $18, Number of customers = 5500 + 500 = 6000

Here, we can see that there is a linear change in the number of customers whenever there is decrease in the monthly rate.

We have 2 pair of values here,

x = 20, y = 5000

x = 19, y = 5500

Let us write the equation in slope intercept form:

Slope of a function:

So, the equation is:

Putting x = 20, y = 5000:

Let us check whether (18, 6000) satisfies it.

Putting x = 18:

so, it is true.

So, the answer is:

The best fit is A. Linear model

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step-by-step explanation: