GloboDrugs Inc., a pharmaceutical company, is developing a new COVID-19 vaccine. The demand schedule for the vaccine (once it is developed) is shown below; the marginal revenue they could earn from selling the vaccine as a monopolist is also below. The firm's fixed costs for developing the vaccine is $3 million, and the marginal cost of producing the vaccine is zero.

Price (per dose)	Quantity Demand (thousands)	Marginal Revenue (per dose)
100	0	-
90	25	90
80	50	70
70	75	50
60	100	30
50	125	10
40	150	-10
30	175	-30
20	200	-50
10	225	-70
0	250	-90

a) If GloboDrugs develops the vaccine and can act as a monopolist, which quantity will it choose to produce? What price will it charge? What will its profit be? Does this give GloboDrugs an incentive to engage in the costly development of this vaccine? Explain. (4 marks)

b) Suppose now that the government announces that in order to make COVID-19 vaccines more widely available, it will force the producer to sell the vaccine at marginal cost. If GloboDrugs develops the vaccine, what will the price be and how much of the vaccine will be sold? What will its profit be? Does GloboDrugs have an incentive to engage in the costly development of the vaccine? Explain. (4 marks)