A capitalist economy can be defined as an economy in which most of the economic activities have the following characteristics.

(A) Sale and purchase of labour services at their own price.
(B) Sale and purchase of labour services at the wage rate.
(C) Production takes place for selling.
(D) Authorities may intervene to achieve an equitable distribution of the final mix of goods and services.

Choose the correct answer from the options given below:

(B), (C) and (D) only

The correct answer is Option (4) → (B), (C) and (D) only

(A) Sale and purchase of labour services at their own price — Incorrect. In a capitalist economy, labour services are not sold at any arbitrary price, but rather at a market-determined wage rate based on supply and demand. Therefore, this statement is not accurate.

(B) Sale and purchase of labour services at the wage rate — Correct. This reflects the market mechanism in a capitalist economy, where workers offer their labour and are compensated at a prevailing wage rate.

(C) Production takes place for selling — Correct. In capitalism, the motive behind production is profit. Hence, goods and services are produced not for self-consumption but for sale in the market.

(D) Authorities may intervene to achieve an equitable distribution of the final mix of goods and services — Correct
Although capitalism promotes free markets, the government may intervene (through taxation, subsidies, welfare programs) to ensure equity and correct market failures.