1. The following quote appears in The Wealth of Nations, a very influential economics book published in 1776 by Adam Smith. It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard for their own interest. Briefly interpret this statement, explaining why their regard for their own interest can allow others to expect dinner. 2. Read the following article on prison privatization: https://goo.gl/NtN4nz then answer the following questions. a. How would a private prison measure its productivity, and how could their productivity increase? b. Do you think the usage of profit maximizing prisons is a net positive or negative from societys perspective? Explain. 3. Read the following article on changes in Spains wine industry: http://goo.gl/9fZKml then answer the following questions. a.) The article notes that Spanish and Italian wine were exported for the same price in 2000, but in 2014, Italy was selling its wine for an average of $2.78 while Spains sold for $1.30. Explain what has happened to the supply and/or demand curves for exported wine from Italy and Spain to cause the price of wine from Spain to decline relative to the price of wine from Italy. b.) The article mentions that a lot of Spanish wine producers rely on bulk and economies of scale. Suppose a typical producer has fixed costs equal to $20 million and marginal costs equal to $1 per liter. Calculate their average total costs at Q=100,000; Q=500,000 and Q=1,000,000. c.) Suppose costs are what are stated in part b.) and the market price is equal to $1.30 per liter. How many liters would have to be sold for this producer to be profitable?