Every morning, leslie drinks coffee (c) or tea (t) with her waffles. for leslie, 1 cup ofcoffee and 1 cup of tea are that same thing, and thus her preferences can be represented byu(c, t) =c+t. a cup of coffee costs $3, and a cup of tea costs $2; leslie has $5. forthe sake of consistency, let coffee be our x-axis good (i. e., good 1), and let tea be our y-axisgood (i. e., good ) what is leslie’s best feasible bundle? (b) graphically depict the best feasible bundle (make sure to label your axes, include a b. c.,and an indifference curve() holding constant leslie’s income and the price of tea, what will be the new optimalbundle if coffee is now half off (per ) explain how the optimal consumption bundle will change if the price of coffee is thesame as the price of tea?

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of the three mortgage options that demarco and tanya have to choose from, the balloon payment mortgage would be their best option, over adjustable payment and fixed payment plans.ultimately, the balloon payment plan would save demarco and tanya overall, in interest, would cost less monthly, and they would only have to make these payments for 8 years, opposing to 30 years for adjustable or fixed payment plans. 

overall, demarco and tanya would save $80,811 if they chose balloon payments over fixed payments, and would save $116,711 if they choose balloon payments over adjustable payments. benefits with choosing fixed payments over adjustable payments is that, in the end, the payments will still be $836.30 a month, while with adjustable payments, the initial monthly payments will be $763.38 to $1082.70 a month, ultimately leading to a more costly purchase. benefits with choosing fixed payments over balloon payments are not present. benefits in choosing adjustable payments over is that it has a lower interest rate, and starts with lower monthly payments initially. benefits in choosing adjustable payments over balloon payments include a lower interest rate, and lower initial monthly payments. benefits in choosing balloon payments over fixed payments include lower interest rates, lower overall price, lower monthly payments, takes less time to pay off, and does not require a downpayment. benefits in choosing balloon payments over adjustable payments include, lower monthly payments (when averaged), takes less time to pay off, and lower overall price.

hence, option c, balloon payments, is the best option for demarco and tanya to make this purchase, for it will save them a minimum of $80811, and a maximum of $116,711.