Calculate the firm's total profit.

If a monopolist's marginal revenue is $25 a unit and its marginal cost is $25, then

A) to maximize profit the firm should decrease output. B) to maximize profit the firm should continue to produce the output it is producing. C) to maximize profit the firm should increase output. D) Not enough information is given to say what the firm should do to maximize profit.

The graph that represents the amount of deadweight loss (measured on the vertical axis) as a function of the size of the tax (measured on the horizontal axis) looks like

a. a U. b. an upside-down U. c. a horizontal straight line. d. an upward-sloping curve.