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a price war recently broke out between Dunkin Donuts and Starbucks. (i) The price per donut is originally $1.00. (ii) Starbucks cut its price to 50 cents per donut. (iii) Dunkin Donuts responded by giving away the first two donuts for free and then charging $1.00 per donut.

Graphically show the price war by drawing a typical consumers budget lines for each situation, and labeling each budget line with its number (i, ii or iii). (You can use Y for income, or if you prefer you can assume the representative consumer has an income of $10.)

a price war recently broke out between Dunkin Donuts and Starbucks. (1) The price per donut is originally $1.00. () Starbucks cut its price to 50 cents per donut. (iii) Dunkin Donuts responded by giving away the first two donuts for free and then charging $1.00 per donut. Graphically show the price war by drawing a typical consumer's budget lines for each situation, and labeling each budget line with its number (i, ii or iii). (You can use Y for income, or if you prefer you can assume the representative consumer has an income of $10.) S Donuts