Please read the scenario and answer question 1 using only the concepts of Supply and demand, Consumer and Producer surplus, Taxes and Subsidies, and Consumer Behaviour.

Premise \"The Canadian government recently announced a Zero Emissions Vehicle (ZEV) mandate. It requires that by 2030, half of all new lightduty vehicles sold fall into the ZEV category, which includes electric, hybrid, or hydrogen powered vehicles. By 2035 this requirement will apply to all new lightduty vehicles. Without providing any details, the government also announced it will make $1.5B available for rebates (or subsidies, herein used interchangeably) on ZEV purchases.\" Scenario This announcement has garnered the attention of many ZEV proponentsincluding Elon Musk. In light of this, Elon has become obsessed with the Canadian ZEV market and, as such, has set up a new head ofce in Toronto. The Board of Directors has told him that he needs to hire a Chief Economist to assess the market landscape here in Canada in the wake of the government's new ZEV mandate. As part of the hiring process, he has put together an assignment for this class. He has chosen to provide an outline where he has specied the key topics he wants candidates to address. Although these topics are fairly wide open, Elon wants his Chief Economist to apply economic concepts across a range of possible issues as they relate to Tesla. That being said, part of this assignment is to gauge how youias an economistithink these areas relate to Tesla's business. That means you do not have to address all of the guiding points provided and are encouraged to offer insights that stand out from the crowd. In doing so, keep in mind that Elon is also a stickler for concision, so make sure everything you include in your assignment adds to your addressing of the section's topic. Elon has set a hard limit for the assignment of 500 words. Remember, your chance of getting this position depends signicantly on the output of your work. Here is the outline he has provided: 1 The Subsidy and the ZEV Market (30 points) I am trying to get a better understanding of how this new mandate will impact Canada's ZEV market. I know that for some years, the federal and most provincial governments have offered incentives for consumers who buy ZEVs. The Federal government currently provides a subsidy of up to $5,000 on the purchase of new ZEV; this rebate only applies to cars under $45,000, for the most part. There are a limited number of rebates available in that the incentive program has limited funds. Before the mandate's new funding, there was only enough for 120,000 vehicles, assuming $5,000 for each new car sold. Tesla's business is directly related to this topic. I need my Chief Economist to explain the elements of ZEV market and the possible consequences of the new mandate for Tesla's revenue. In doing so, keep in mind the following (but do not limit yourself to this list, it is by no means comprehensive): . The market demand for a ZEV with and without the ZEV subsidy . The impact of the cutoff price (under $45,000) on vehicles eligible for the subsidy . How will the subsidy affect market supply in the short and long run? . The effect of the mandatewhich is essentially a ban on lightduty vehicles that are not zeroemission after 2035ion consumers . Consequences for Tesla's revenue