Beans Inc. operates in a perfectly competitive agricultural industry. Classica Apparel Inc., in contrast, operates in a monopolistically competitive industry. Keeping this information in mind, which of the following statements is true?
A. Beans Inc. will face competition from many sellers, whereas Classica Apparel Inc. will be the only seller in the market.
B. While Classica Apparel Inc. will have the power to set the prices for its products, Beans Inc. will have little or no ability to do so.
C. Beans Inc. will have many buyers for its products, whereas Classica Apparel Inc. will have very few buyers for its products.
D. While Beans Inc. will communicate the degree of product differentiation through advertising, Classica Apparel Inc. will need no advertising.
Answer: While Classica Apparel Inc. will have the power to set the prices for its products, Beans Inc. will have little or no ability to do so.