5. [15 points] a) Californian fruit growers are in trouble because water has become so scarce that the market price of water has permanently risen above their breakeven points. If they succeeded in lobbying the government to sell them water at highly subsidized rates, would it be profit maximizing for them to stay in business? What does this depend on? Explain. (5) b) Explain the workings of the Winner's Curse. How should you react when you realize your competitors in an auction suffer from it? (5) c) Which one is larger: the short or longrun price elasticity of demand for a good? Explain