macro help

14. (20 points) Cheyenne's budget constraint is given by the equation C = (1 - T)w(h - l) + II with r = 0.50, w = 60, h = 10, and II = 80. Cheyenne's first order condition, when rearranged and simplified, describes her optimal labor supply: NS = 12 - 2w (1 - T) a. Calculate Cheyenne's optimal consumption-leisure bundle (you do not need to take any derivatives). Draw her budget constraint and the indifference curve going through the optimal point. Be sure to label all axes, intercepts, and slopes. (8 points) b. If Cheyenne mistakenly chose to be at point (c = 200, l = 6) on the budget line, would her MRS at that point be greater than, smaller than, or equal to the slope of the budget line? (Hint: draw the indifference curve going through this alternative point on the same graph as above for the visual relationship between MRS and slope). Explain the intuition behind your answer. (4 points)