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Suppose that under these circumstances the Gates' optimal bundle of food and other goods is 600 units of food and 600 units of other goods.

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Suppose that under these circumstances the Gates' optimal bundle of food and other goods is 600 units of food and 600 units of other goods. The government introduces a subsidy on food. Suppose that the price of food after the subsidy is p=.8. c. In a new diagram illustrate the effect of the subsidy on the Gates' budget line. Include the original budget line in your diagram. Make sure that you indicate the numerical value of the intercepts of both budget lines. What is the numerical value of the new opportunity cost of other goods in terms of food? Explain in words what the opportunity cost of other goods in terms of food is

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