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6 BACKGROUND TO SUPPLY: FIRMS IN COMPETITIVE MARKETS

The Costs Of Production • A firm’s costs are a key determinant of its production and pricing decisions. • Most firms in competitive markets are small • Firms aims to maximize their profit • Profit=total revenue-total cost

6 BACKGROUND TO SUPPLY: FIRMS IN COMPETITIVE MARKETS

The Costs Of Production • A firm’s costs are a key determinant of its production and pricing decisions. • Most firms in competitive markets are small • Firms aims to maximize their profit • Profit=total revenue-total cost

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