Darius buys only milk and cookies.

a. In year 1, Darius earns $100, milk costs $2 per quart, and cookies cost $4 per dozen. Draw Darius’s budget constraint.

b. Now suppose that all prices increase by 10 percent in year 2 and that Darius’s salary increases by 10 percent as well. Draw Darius’s new budget constraint. How would Darius’s optimal combination of milk and cookies in year 2 compare to his optimal combination in year 1?