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)How much will the firm produce?

b)How much will it charge?

c)Can you determine its profit per day? (Hint: you can; state how much it is.)

d)Suppose a tax of $1,000 per day is imposed on the firm. How will this affect its price?

e)How would the $1,000 per day tax its output per day?

f)How would the $1,000 per day tax affect its profit per day?

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

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

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