Question

What are the important features of a capitalist economy? 

Options

• Role of the government

• Profit motive

• Central problems

• All of the above

Answer 1

All of the above

Explanation: 

A capitalist economy has the following characteristics:

1. Role of the government
   The government provides the basic structure for an economy's smooth operation. It establishes the foundation and is responsible for maintaining law and order, justice, growth and stability, and defense, among other things.
2. Profit motive
   The prime mover drives the economic agents. Profit maximisation is the driving force behind all we do.
3. Central problems
   The major problems of an economy are solved by market forces such as demand and supply, or the rule of demand and supply. Only the commodities and services requested by the economy will be supplied by the producers.