The following table shows production costs of an antibiotic drug for the current production level of 5 million kg per year (assume a constant average and marginal cost of production). Average variable cost (variable cost per kg) Raw materials $1.50 Utilities $0.40 Labour $1.10 Average fixed cost (fixed cost per kg) Plant and equipment $1.50 Overhead $1.30 The firm currently has an exclusive patent on the drug, which makes it the only producer of the drug in the market. The market demand for the drug is given as follows: Q (million kg per year) P ($ per kg) 10 6 9 8 8 9 10 11 12 13 14