1. A firm faces the following inverse demand curve: P = 500 - 0.25Q Where: Q is the monthly production P is price, measured in dollars per unit. The firm also has a total cost (TC) function of: TC = 200Q. Assuming the firm maximizes profits, answer the following: a) Assuming the firm operates as a monopolist, calculate the following: price, quantity, and profit. Graph and show the equilibrium price and quantity. b) Assuming perfect competition, what are price, quantity and profit? Show on the graph from above.

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