The demand curve that a firm faces in a perfectly competitive market...........

Perfectly elastic.

The correct answer is Option (4) → Perfectly elastic.

In a perfectly competitive market, individual firms are price takers. This means they have no power to influence the market price of the good they sell. The market determines the price, and each firm must accept that price. Because the product is homogeneous (identical across all firms) and there are many buyers and sellers, if a single firm tries to raise its price even slightly above the market price, it will lose all its customers to competitors. Conversely, it can sell all the output it desires at the prevailing market price without affecting the price. This characteristic leads to the firm facing a perfectly elastic demand curve. Graphically, this is represented as a horizontal straight line at the market price.