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Pizzas R US is the only restaurant that produces and sells pizzas for Bayou La Batre, Alabama. The following equations describe the monopoly's demand, MR, total cost, and MC.
Demand: P = 10 - Q
Marginal Revenue: MR = 10 - 2Q
Total Cost: TC = 3 + Q + 0.5Q2
Marginal Cost: MC = 1 + Q
How many pizzas does the restaurant produce and what is the price? What is the restaurant's profit? (HINT: Remember a monopoly produces where MC = MR and gets its price off of the demand curve. Also, remember that TR = P*Q.)
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