Suppose Home's demand function for wheat is D = 160 - 10P. Its supply function is S = 40 + 10P.

(1)What is Home's import demand function for wheat?(1 point)

(2) What is the price of wheat in the absence of trade? (1 point)

Now we add Foreign, which has a demand function D* = 100 - 5P and a supply function S* = 60 + 15P. Allow Foreign and Home to trade with each other, at zero transportation cost.

(3) Find the equilibrium under free trade, i.e., what is the world price of wheat? What is the volume of wheat traded? (2 points)

Suppose Home imposes a specific tariff of 2 on wheat imports.

(4) What is the new price of wheat in Home and Foreign, respectively? What is the volume of trade? (2 points)