2. (30 marks] Refer to the graphs in Figure 1 to answer the following questions. Suppose that instead of a tariff, Home applies an import quota limiting the amount Foreign can sell to 2 units. 3. Determine the net effect of import quota on the Home economy if the quota licenses are allocated to local producers. b. Calculate the net effect of the import quota on Home welfare if the quota rents are earned by foreign exporters. c. How do your answers to parts [a] and [b] compare with part [c] of Question 1? Does your answer depend on the assumption of a perfectly competitive market structure? Explain. 3. [20 marks) Answer the following questions. a. Distinguish between internal and external economies of scale. b. What are the implications of external and internal economies of scale on the industry's market structure