1 General Equilibrium The small country of Banania is trading bananas with the European Union. The demand and supply functions are given by DB = 45 p SB = 8p DEU = 515 4p SEU = p. (a) Which price for bananas would arise in Banania in the absence of trade? (b) What would be the price if there was a free-trade agreement? How much would Banania export? (c) What is the loss to the consumers of Banania as a consequence of free trade? (d) Banania is now imposing an export tax of $14 per unit of bananas exported. What is the new 1 price of bananas in Banania? How much do they export? (e) What is the loss of this export tax for producers in Banania? How much do consumers in Banania gain?