1. III-Kind and Cash Transfers Consider an individual who derives their utility from housing consumption (h) and nonhousing consumption (1: uiZc, h.) The individual maximizes utility subject to a budget constraint: per: + pith = y a] graph the consumer's budget constraint, and a corral-Sponding Optimizing consumption bundle {assume that the household consumes a mix of housing and nonhousing] - Now suppose that the government provides an inkind preportional rent subsidy equal to o: of the lmuseholds total housing expense b} write the new budget constraint under subsidy program, and graph the new budget constraint e) plot the oorresponding optimizing consumption bundle under the new constraint [assume that the house hold oonsurnes a mix of housing and nonhousing} and label the level of housing consumption hjx - Now suppose instead of providing the individual an inkind subsidy, the government provides a cash grant equal to the size of the government outlay under ill-kind proportional rent subsidy. d} write the new budget constraint under the equivalent cash subsidy program, and graph the new budget constraint e) does the cash grant increase housing conslunption by more, less or the same as the inkind transfer? do you know? f] does the cash grant lead to higher, lower, or the same utility as the ill-kind transfer? do you know