Question 1 a. Explain why scarcity leads to tradeoffs. [3 marks] b. 1What is the difference between positive and normative analysis? Which of the following statements would entail positive analysis, and which normative analysis? i. Internet auction companies will erode the prots of local automobile dealerships. ii. The government should impose special taxes on sales of merchandise made over the Internet. [4 marks] c. 1Why is the circular flow model important? [3 marks] Question 2 Show in a diagram the effect on the demand curve, the supply curve, the equilibrium price, and the equilibrium quantity of each of the following scenarios. a. The market for face masks in your country i. Scenario 1: The emergence of the COVID19 pandemic. [3 marks] 1'i. Scenario 2: An increase in the number of manufacturers of reusable masks. [3 marks] b. The market for the iPhones 1. Scenario 1: A new Samsung cellphone is released at a lower cost than the iPhone. [3 marks] ii. Scenario 2: There is an increase in the price of iPhone accessories. [3 marks] c. The market for blueberry mufns 1. Scenario 1: More people become health conscious and realize the high sugar content of mufns. [3 marks] ii. Scenario 2: The price of blueberries has increased [3 marks]