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Help me solve parts A,B,C, and D with the figure and this is from Econ-251 class Problem 2 Suppose there is a monopoly firm operating

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Help me solve parts A,B,C, and D with the figure and this is from Econ-251 class

image text in transcribed
Problem 2 Suppose there is a monopoly firm operating in the Home market in the no-trade situation. When Home opens up to trade, many foreign firms are willing to sell in the Home market at the world price denoted by Pw- Price MC A P Pw B B MR D E Quantity To reference any area easily, label any other unlabeled points in the figure above and use those letters when answering questions below. a) Under free trade, with the price pw, identify the consumer surplus and producer surplus. Find the area of total Home surplus (the sum of consumer surplus and producer surplus). (4 points) b) Compare total Home surplus under free trade from part a) with total Home surplus under Home monopoly (no trade) and find the area of gains from free trade. (5 points) c) Compare total Home surplus under free trade from part a) with total Home surplus in a hypothetical setting where Home market is perfectly competitive (no trade), and identify the area of gains from free trade in this case. (5 points) d) Given your answers in parts b) and c), in which case are gains from free trade higher and why? Explain. (3 points)

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