1. LUMBER (Comparative Statics). During the pandemic, many families incurred much lower commuting costs and were unable to take vacations, so many spent their unexpectedly large incomes on home improvements. Suppose that the competitive market for lumber (wood cut into planks often used for home building) is described by market supply, Q5 = :P , and market demand, Qd = 40 2P + 2W, where Y is the level of income, P the price, and Q9 and Qd the quantities supplied and demanded. a) If the level of income is 400, then nd the priceelasticity of demand at the equilibrium price. b) Find the two reduced form equations that show how the equilibrium price (P*) depends on the level of income and how the equilibrium quantity (Q*) depends on income. :11" (10' and c) Find how P* and Q* change when the level of income (Y) changes. In other words, nd arr av