Question 1 Below, you are provided with the domestic demand and supply curves for palm trees. Use this diagram to answer all parts of this question Price $600 ...... i ; ' j _______ $500 r--1- 4... $400 ........__ $300 - ' $200 Z I $100 """"" i 20 4o 60 so 100 120 140 Quantity of Palm Trees (in thousands) Part (1'): Suppose that the world price ofa palm tree is $400 [i.e., that American sellers can sell an unlimited number of palm trees for $400 each, and that American consumers can purchase an unlimited number of palm trees for $400 each). How many palm trees will American consumers purchase? Part iii): Suppose that the world price of a palm tree is $400. How many palm trees will American sellers sell? How many palm trees will the United States export? Part iiii):5uppose that the world price of a palm tree is $500 . How many palm trees will American consumers purchase? Part (iv): Suppose that the world price of a palm tree is $500. How many palm trees will American sellers sell? How many palm trees will the United States export? Part (v): If a country currently exports a good or service ,and the world price of that good or service rises, what is the effect on: 1] domestic production, 2) domestic consumption, and 3) the quantity of exports? Question 2