1) (25 points) Consider a nonrenewable resource that can be consumed either today (period 1) or tomorrow (period 2) and has a finite supply of 50 units. Assume the inverse demand for the resource in both periods is: D : P, = 95-20, i=1,2 Assume the marginal cost of extracting the resource is constant at $20 and the social discount rate is 15 percent (r = .15). a) Determine the socially efficient extraction/consumption path for the resource. b) What is the undiscounted total surplus generated from consumption of the resource in period 1? c) What is the undiscounted total surplus generated from consumption of the resource in period 2? d) What is the smallest possible intergenerational transfer that is consistent with sustainability? Assume the rate of return on investment equals the social discount rate. e) If we had assumed a 10 percent social discount rate, how would the efficient consumption path change? Would the intergenerational transfer necessary for sustainability have to be larger or smaller