Mick has $100 of income per week available for recreational activities, including exercise, movies, restaurant meals, etc. Mick's health club charges a fee of $4 per hour, and Mick chooses to use the facility for 10 hours per week.
a) Illustrate Mick's consumption choice in a diagram with health club usage on the horizontal axis and other recreational activities on the vertical axis.
b) Now Mick's health club institutes a new pricing policy. A fixed fee of $30 per week is charged for access to the facilities, but then a rate of $1 per hour is charged for each hour of utilization. Is Mick better off as a result of this change? Explain your answer using the diagram that you drew in (a).