In a perfectly competitive market, under what condition should a firm continue to produce in the short run despite incurring losses?

In a perfectly competitive market, a firm should continue to produce in the short run even if it is incurring losses as long as it can cover its variable costs. This means that the revenue from selling its products is enough to pay for the costs that change with production, like materials and labor, but not necessarily the total costs, which include fixed costs like rent. For example, if a bakery sells enough bread to pay for flour and wages but not enough to cover the rent for the building, it should still keep baking bread in the short run. By doing this, the bakery can minimize its losses because it is still bringing in some money to help pay off its fixed costs. If the firm stops producing altogether, it would lose all its revenue, making the situation worse.