The use of word “competition” in the name of the market structure called “monopolistic competition” refers to the fact that?

1. A Option A: there are many sellers in a monopolistically competitive market and there is free entry and exit in the market just like a competitive market
2. B Option B: Monopolistically competitive firms face a downward-sloping demand curve just like competitive firms.
3. C Option C: Monopolistically competitive firms charge prices equal to the minimum of their average total cost just like competitive firms.
4. D Option D: The products are differentiated in a monopolistically competitive market just like in a competitive market.