The perfectly competitive firm maximizes profit by producing at the point where price equals marginal cost.

Name: The perfectly competitive firm maximizes profit by producing at the point where price equals marginal cost.
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Question

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In perfect competition, firms maximize profit by producing where price equals marginal cost because this is the point where the cost of producing an additional unit equals the revenue gained from selling it, ensuring no additional profit can be made by altering output.

The Perfectly Competitive Firm Maximizes Profit by Producing at the Point