A monopoly firm faces a demand curve given by the following equation: P = $500 10Q, where Q equals quantity sold per day. Its marginal cost curve is MC = $100 per day. Assume that the firm faces no fixed cost. You may wish to arrive at the answers mathematically, or by using a graph (the graph is not required to be presented), either way, please provide a brief description of how you arrived at your results.

a)Now suppose a tax of $100 per unit is imposed. How will this affect the firm's price?

b)How would a $100 per unit tax affect the firm's profit maximizing output per day?

c)How would the $100 per unit tax affect the firms profit per day?