A1.2 You are a manager of Mooses Munchies, a hamburger restaurant. The price of hamburgers is $4
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A1.2 You are a manager of Moose’s Munchies, a hamburger restaurant. The price of hamburgers is $4 per hamburger, and Moose’s Munchies incurs a total cost of TC1Q2 = 0.05Q2 - 20 when it produces Q hamburgers.
a. Moose’s Munchies’ total benefit is its total revenue, which equals the price multiplied by the quantity of hamburgers, P * Q. What is Moose’s Munchies’ marginal benefit of producing and selling each additional hamburger?
b. What is Moose’s Munchies’ marginal cost of producing and selling each additional hamburger?
c. Determine the profit-maximizing number of hamburgers, Q*, that Moose’s Munchies should produce and sell.
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