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In a perfectly competitive market, all n firms are equal. Thus, the market total cost is the total cost (TC) of one firm multiplied by the amount of n firms in the market

Total Market Cost = n(TC)

Total cost relates to output because firms want to make a profit.

Profit = TR - TC where TR = total cost and TR = total revenue.

Firms produce at the quantity which MR (marginal revenue) = MC (marginal cost). At this quantity, multiply it by n number of firms in the market to achieve the total output in a market.

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