3) Suppose that a monopolistic seller of designer handbags faces the following inverse demand curve: P=100-q. The seller can produce handbags for a constant marginal and average total cost of $20. a. Calculate the profit-maximizing price for this seller b. Suppose the government levies a $6 tax per unit on sellers of handbags. Calculate how this tax will affect the price the monopolist charges its customers. c. Who bears the burden of this tax?
