7. Tom earns $15 per hour and is exempt from paying taxes, regardless of the number of hours he works. Additionally, Tom must pay $3 per hour in child care expenses for each hour he works and receives $200 in tax-exempt lottery winnings each week. There are 110 hours in a week for Tom to allocate between work and leisure. (a) Write out the equation for Tom's weekly budget line. Solution: Tom's effective hourly wage: $15 - $3 = $12 per hour. V = 200, T = 110.C =(WT +V)-wL=(12 x110+200)-12L=1520-12L (b) Sketch the equation for Tom's weekly budget line. Make sure to label (i) his endowment point and (ID) his total consumption if he took no leisure time