Anam is a top tech developer who can't figure out how many hours she should work. She enjoys staying

fit and eating healthy. In fact, her utility is a function of how much yoga she does (in her leisure time)

and how many organic granola bars she consumes. Her preferences are defined by

U(y, g) = y g

where y is the units of yoga, measured in hours of leisure, and g is the units of granola bars measured as

consumption good (in rupees).

Anam has no other non-labor income. Her only source of income is her salary. Her total available hours

are 24 hours per day. Her wage is w = 100 per hour. The price of granola bars is Pg = 5.

a. Write down Anam's budget constraint and draw it with granola on y-axis and yoga (hours) on x-axis.

b. Find the optimal amount Anam will spend doing yoga and her demand for granola bars.

c. How would Anam's demand for yoga and granola change if her wage increased to Rs. 150 per hour.