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3. The figure given below shows the U.S. market for imported wine. For simplicity, we consider export supply curves to be flat. Chilean wine is available for $480 per barrel and French wine is available for $420 per barrel. Price per barrel Chilean price French price US demand for imported wine 10 15 22 Qua ntity (millions of barrels per year) a. Under free trade, how many barrels of wine will the United States import and who will they import from? b. Suppose that the United States imposes a tariff of $80 per barrel on imported wine. How many barrels of wine will the United States import and who will they import from? c. Suppose the U.S. joins a free trade area with Chile. i. Calculate the gain arising from an increase in net volume of trade after the U.S. joins the free trade area (trade creation). ii. Calculate the loss suffered by the US arising from the shift of trade from low-cost exporters to highercost bloc-partner exporter (trade diversion). iii. What is the net effect on the US. well-being ofjoining the trade bloc