Irwin is a monopoly seller of specialty bearings. Consider the graph below, which illustrates the demand and marginal revenue curves for Irwin's 30-weight ball bearings, along with the marginal and average total costs of producing bearings:
a. Find the monopolist's profit-maximizing level of output.
b. Determine the price the monopolist should charge to maximize profit.
c. Draw an appropriate rectangle on your graph to represent the total revenue the seller receives from selling the profit-maximizing quantity of bearings at the profit-maximizing price.
d. Draw an appropriate rectangle on your graph to represent the total cost of producing ball bearings.
e. The difference in the areas you drew in (c) and (d) represents profit. Calculate the profit Irwin earns from selling 30-weight ball bearings.