[Related to Solved Problem 10A.1 on page 345] Dave has $300 to spend each month on DVDs and CDs. DVDs and CDs both currently have a price of $10, and Dave is maximizing his utility by buying 20 DVDs and 10 CDs.

Suppose Dave still has $300 to spend, but the price of a DVD rises to $12, while the price of a CD drops to $6.

Is Dave better or worse off than he was before the price change? Use a budget constraint–indifference curve graph to illustrate your answer.