Firm and Industry - There is no fixed size of an industry...

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Firm and Industry: A competitive market is made up of a large number of firms with complete freedom of entry. Such firms together are called competitive industry . An industry can be defined as a group of firms producing homogeneous products with freedom of entry and exit and which earn only normal profits. Hence the concept of an industry is applicable only under competitive conditions.
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Unformatted text preview: There is no fixed size of an industry though the analytical stability of an industry can be stated. An industry is said to be stable and in equilibrium when in the long run all adjustments have been made and there is neither tendency for outside firms to enter nor tendency for inside firms to exit; hence each firm makes only normal profits....
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