1) Forest Preservation. (30 Points) A Pennsylvania farmer owns 800 acres of forest on the edge of his existing cropland and is thinking of cutting it down to expand his crop acreage. Because of differences in soil fertility, the profit that the farmer can earn from farming this land varies from parcel to parcel - some acres yield profits as high as $60 per acre and others yield only $15 per acre. The per-acre profitability of the various parcels is given by the map below, where each parcel contains 100 acres. The standing forest provides habitat for wildlife, absorbs CO2, and purifies water. The provision of these services depends on the farmer's choice of how much to expand his crop acreage - i.e., the farmer "supplies" environmental goods by choosing to leave some or all the forest alone. For this question, suppose each acre of preserved forest yields the same level of environmental benefits on all parcels - i.e., preserving forest on a parcel that yields farm profit of $15 per acre provides the same ecological value as preserving forest on a parcel that yields $60 per acre. Using the setup, answer the questions below. 15 20 60 Existing cropland 15 16 28 40 100 acres of forest Potential profit per acre in farming ($/acre) a) Suppose the farmer is forced to preserve one acre of forest. In other words, he could clear- cut and farm any 799 acres of his choosing but would have to leave one acre of forest standing. What would be the cost to the farmer of preserving this one acre? Explain