Options of answers for both: "worse off", "equally well-off", "better off". Please provide changes in the graph.

Governments generally limit the amount of the childcare subsidy. For example, in Washington State, the 2015 maximum subsidy for an infant is $31.47 per day. A binding limit on the subsidy creates a kink in the budget constraint. Show how a limit changes the analysis in the Challenge Solution. Assume the individual's preferences are such that she consumes child-care beyond the subsidy limit. Suppose a consumer is initially maximizing utility at bundle e, on indifference curve I and budget line L'. Then the government begins providing a subsidy with a limit, which changes the budget line to L2 with the kink. Other goods 1.) Using the point drawing tool, identify the new utility-maximizing consumption bundle with the limited subsidy. Label this point 'e2.' 2.) Using the line drawing tool, draw a new budget line that provides a lump-sum payment O1 (without a child-care subsidy) to the consumer that costs the same amount as the limited 12 subsidy. Label this line 'L 3. 12 L1 3.) Using the point drawing tool, identify the utility-maximizing bundle with the lump-sum. CC1 Label this point 'e3." Child-care Carefully follow the instructions above, and only draw the required objects. The consumer is with the lump-sum (compared to the limited subsidy), and child-care providers are with the lump-sum (compared to the limited subsidy). worse off equally well-off better off