Suppose that you hired a consultant for your company to estimate the demand for your cardboard boxes. Your consultant determines that you are operating your business in a monopolistically competitive environment. You collect data on the price and quantity of boxes sold and send it to your consultant, who then estimates the inverse demand equation as P = 7 (1.5)*Q. Please also assume that you have a fixed cost of $1 and that the variable cost as estimated by your consultant is V(Q) = 3Q + (0.5) ².

1. What is the quantity that maximizes profits based upon the above information? What are the corresponding maximum profits that you can earn? (Please use graphs to support your answer.)