Statement–Argument — Should user charges be increased in sectors like telecom? Arguments: I. Yes. Higher revenue can fund service-quality improvements for consumers. II. No. Higher tariffs will price out some users and reduce access.

Introduction / Context:Pricing in network industries balances investment incentives with universal/affordable access. The proposal is to increase user charges.

Given Data / Assumptions:

• I: More revenue can fund capex/opex, improving coverage and quality.
• II: Price hikes reduce demand among price-sensitive users, harming inclusion.

Concept / Approach:Both arguments engage core objectives: quality funding and affordability. Strong evaluation recognises that tariff design can trade off (or reconcile) these via targeted subsidies, lifeline plans, or tiered pricing.

Step-by-Step Solution:1) I is strong: sustainable investment requires revenue; service quality is a legitimate policy goal.2) II is strong: affordability and digital inclusion are also legitimate; blunt hikes can exclude low-income users.3) Hence, both I and II are strong; optimal policy often blends modest hikes with protections.

Verification / Alternative check:Universal service obligations and lifeline tariffs exemplify balancing the two goals.

Why Other Options Are Wrong:Picking only one ignores the countervailing, equally valid objective; “neither” undervalues both.

Common Pitfalls:Assuming price and access cannot be co-managed through targeted instruments.

Final Answer:If both I and II are strong.