Which of the following is applicable in a wholly capitalist economy?
Answer Details
In a wholly capitalist economy, the price mechanism allocates resources. This means that the forces of supply and demand determine the prices of goods and services, and producers and consumers are free to make their own choices. The market regulates itself without any significant government intervention. Therefore, options 1 and 4 are not applicable in a wholly capitalist economy. In such an economy, the consumer is sovereign because producers respond to consumers' preferences and demands, making false.