Extremely poor designation on this question! Either Ahí or Allí should be accepted since there is no way of knowing the even approximate distance by stating "phone conversation." A phone conversation can be held between people living in the same city, in which Ahí would be appropriate, or in another country, in which case Allí should be used.
The lesson explains that these adverbs are not only used considering a close, medium or long distance; they are also used considering whether the "thing" is near the speaker or near the listener. So, in a phone conversation, the speaker would use "ahí" (not allí) if what they are referring to is something that is placed where the listener is. For example, if I am having a phone conversation with someone and want to ask about the weather wherever the other person is (the listener), I would use ahí:
- ¿Ahí está lloviendo?
- Is it raining there [where you are, where you live]?
- Aquí no.
- Here it isn't.
I hope this clarified it.
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