1.Assume that DzStan uses child labour in the production of tennis balls. Given the following labour demand and supply functions Qd=8-4w 0.5: 4+} w a] Draw a graph of the labour market of tennis balls b) At equilibrium (1* w*, are demand and supply price elastic? c} A new policy is implemented with the aim of reducing child labour wages. What type of policy would be more effective: a demand-side {ban on child labour} or a supply-side policy {providing monetary incentives for parents to keep children at school)? Why? Explain your answer by providing a hypothetical new demand and a hypothetical new supply and calculating the new equilibrium price and quantity traded. 2. The market for bananas has the following demand and supply functions Qd = 11']I 2P + T Us = 2 + P + DEW where Q is quantity, P is price, Y is income and Wis an index of weather. a} Suppose Y = 1 and w=2, specify the demand and supply curves, show them on a graph, and derive the equilibrium price, quantity, and producer revenue b) Assume that production is negatively affected by a cyclone. Generate a new supply function accounting for the cyclone shock and assess the effects of poor seasonal conditions on the market outcomes P, g and revenue. c} Assess the effects of a doubling of income on market outcomes