Below is a market for bananas

1} Below is a market for bananas in New Zealand. The current price is P. Pequ Price $3 P 2000 6000 10000 Cluantitll What is the current state of the market? Is there excess supply or excess demand? How do you know this? How many units of excess supply or demand are there? Now, we know that equilibrium is at the point (6000, pequil)_ Describe the process by which the market moves from disequilibrium at P to equilibrium. 2) Continuing with the diagram above, assume that peqm'l = $2, and that we are now at equilibrium in the market, such that equilibrium is at the point (6000, $2). a) bi c} What is the expenditure by consumers on bananas at this point? What is the Willingness to Pay (WTP) of consumers? Finally, what is the consumer surplus? 3} Electric vehicles are becoming more popular around the world, with many governments committing to targets around electric vehicle use for the future. This includes the New Zealand government. Many claim that the price of these are too high to be making targets. However, the technology for these vehicles is developing all the time. For example, new batteries for electric cars are being developed that include shorter recharge times, lower manufacturing cost, and longer life. a) bl Draw the market electric cars in New Zealand at equilibrium, labelling the axes, demand and supply curves, and equilibrium price and quantity. On your diagram, show the effects of the new batteries on the market, labelling the new price and quantity. Does this help governments with their targets by lowering the price of electric cars? We know from our diagrams that the demand curve slopes downwards from left to right. Why does the demand curve look like this? Provide a brief explanation in the context of electric ca rs