Under profit-maximizing conditions, firms can be classified as operating in either a perfectly competitive or an imperfectly competitive environment. Which of the following sentences help us to differentiate between both environments?

• a) In a perfectly competitive environment, firms face a perfectly inelastic, vertical demand curve, so the firm’s MR (Marginal Revenue) and the price of its product are identical.

• b) In a perfectly competitive environment, firms face a perfectly elastic, horizontal demand curve, so the firm’s MR (Marginal Revenue) and the price of its product are identical.

• c) In a perfectly competitive environment, firms face a negative-slope demand curve, so the firm’s MR (Marginal Revenue) is less than the price of its product.