Suppose that Lisa is given $50 worth of coupons that must be spent on food.
A - How will the coupons alter Lisa's budget line?
B - Suppose that Lisa is given $50 in cash instead of $50 in coupons. How will this alter Lisa's
budget line?
C - Your economist friend says that depending upon the shape of Lisas indifference curves she
can either be indifferent between the food coupon and cash program, OR she could prefer the
cash transfer program over the other. Draw appropriate diagrams of Lisas budget line and
difference curves to illustrate your friends argument. (Be sure to draw food on the horizontal axis.)