Suppose Laurent has $60 per week to spend on food and clothing. The price of food is $4 per unit, and the price of clothing is $6 per unit.

a. Sketch Laurent's budget line on the axes provided.
b. Laurent applies to the local government for food stamps and is given $40 worth of food stamps per week. On the axes, show how the receipt of food stamps affects Laurent's budget line.
c. Suppose that instead of food stamps, Laurent receives $40 in cash per week from a relative. On the axes, show how this gift affects Laurent's budget line.
d. Add appropriate indifference curves to the diagram to show that a gift of $40 in cash could make Laurent better off than the receipt of $40 in food stamps.