Consider the case where the government charges a monopolist a 25 percent (0.25) royalty

on revenue. The firm's demand is given by: P=100 - Q.

b. What is the monopolist's profit-maximizing output when the royalty on revenue

equals zero and the firm's marginal cost of output is constant and equals to $60

per unit. Calculate the profit-maximizing price, total revenue, total royalty

payments, firm profit, and deadweight loss. Include an illustration.