Question

Owners of coffee plantations in the country of jabatina grow their own coffee beans and supply them to various stores and restaurants all over the country. There are many plantation owners supplying to a huge number of companies, and they are typically unable to differentiate their products from one another. They also do not have the power to fix their own prices in the industry. In addition, these suppliers can only achieve competitive parity and not a competitive advantage. Thus, the coffee bean industry in jabatina best illustrates a(n)___ structure.

Answer 1

Answer: Perfectly competitive market structure

Step-by-step explanation: A perfectly competitive market structure has the following characteristics:

a. Large number of firms

b. Free entry and exist of firms

c. Identical goods

d. Perfect knowledge

e. Firms are price takers and not price makers

Since, there are many plantation owners supplying to a huge number of companies with identical products and no power to fix their own prices, the market in reference has characteristics of a perfectly competitive market structure.