The demand for apples for Korea is given by Q= 175-5p. The supply of applies is given by Q =- 25+5p. Initially, all apples are produced in Korea. a. What is the price and quantity in this market? What is producer and consumer surplus? What is the elasticity of demand and supply? b. Suppose that apples become available at a price of $3.00 from new suppliers in the US. You can assume that the supply from the US is perfectly elastic. What happens to the quantity consumed and produced in Korea after the new source of supply becomes available? c. Given the information in b. what happens to consumer and producer surplus? Be precise. Is society in Korea as a whole better off when the US supplies apples at a lower price? Justify your answer.

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