Taiwan’s farmers have a very good harvest of bananas this year. How does it affect the total revenue of the farmers in Taiwan? Explain your answer with a diagram.
Continued from (a), to show its friendship with Taiwan, Beijing decides to buy a substantial amount of bananas from Taiwan.
How does it affect the total revenue of the farmers in Taiwan? Explain your answer with a diagram.
After buying the bananas from Taiwan, Beijing sells them in the mainland (domestic) market. How does it affect the consumer surplus and producer surplus in the mainland market? Explain your answer with a diagram.