In a perfectly competitive industry, when a firm is producing so that its total revenue equals its total cost, the firm is

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In a perfectly competitive industry, firms operate at the point where marginal cost equals marginal revenue (MC=MR) and the price equals the marginal cost (P=MC). At this point, the firm is making normal profit or zero economic profit because its total revenue is covering all of its production costs, including opportunity costs. Therefore, the firm is neither making an economic profit nor incurring an economic loss.

In a Perfectly Competitive Industry, When a Firm Is Producing