please explain how the circled one was taken:

Let c be the investor's optimal consumption plan. Since the investor does not face a binding constraint, she can freely buy or sell a marginal amount of the payoff It+1 at a price p. Then, she could have altered her consumption plan as follows: If c maximises the investor's utility, then & = 0 is an interior solution to max U (Ct - Pt . Et, Ct+1 + It+1 . {t) Et and so the following FOC holds: PL . Ca = B . EP. -Y Pt = B . EP. C.t+ 1 (1) Cit where mill = B. Sitt1 is agent i's sdf. CitThere are two equally likely states of nature that can occur at date t+ 1, either there is an expansion or there is a recession. An investor has preferences over consumption at dates t and t + 1 that can be represented by the utility function CITY 617 was...) 2 + m (u) where 'r y 1 and [3 6 (0,1). The agent can trade a riskfree bond and shares of a firm in a competitive market. Let pi? and p? denote the price of a bond and a share of the firm in period t, respectively. A riskfree bond issued at date it is a promise to pay 1 unit at date t+ 1. The payoff of a share at date t+ 1 is pf\" + cit\