The figure below illustrates the market for steel

The figure below illustrates the market for steel. If the steel market is competitive, firms can produce steel at a constant marginal cost of $100 per ton. Therefore, the price of steel is $100 per ton, and 100 tons are produced. Assume that if all the steel companies consolidate into a monopoly, the monopoly's marginal cost will fall to $70 per ton. Use the straight line tool to draw the monopoly's marginal revenue and marginal cost lines (extend the marginal cost line to 300 tons). Then use the plot point tool to plot the monopoly's profit-maximizing price and output on the demand curve. To refer to the graphing tutorial for this question type, please click here Steel Market Price 160 150 140 130 120 110 100 MG 80 80 70 00 50 40 30 20 10 0 Output (tons of steel