Idol worship was practiced in this period' is correct regarding the nature of the religion of the Later Vedic period.
In the Later Vedic period, the two outstanding Rig Vedic Gods, Indra and Agni, lost their former importance. On the other hand, Prajapati, the creator, came to occupy the supreme position in the later Vedic pantheon. Some of the other minor Gods of the Rig Vedic period also came to the forefront Rudra, the god of animals, became important in later Vedic times and Vishnu came to be conceived as the preserver and protector of the people who now led a settled life instead of a semi-nomadic life as they did in Rig Vedic times. Therefore option (A) is incorrect.
In addition, some symbolic objects began to be worshipped, and we notice signs of idolatry in later Vedic times. Therefore, option(B) is correct.
As society became divided into social classes such as Brahmanas, Kshatriyas, vaishyas and Shudras, some of the social orders came to have their own deities. Pushan, who was supposed to look after cattle, came to be regarded as the God of the Shudras. Therefore, option (C) is incorrect.
People worshipped Gods for the same material reasons in this period as they did in earlier times. However, the mode of worship changed considerably. Prayers continued to be recited, but they ceased to be the dominant mode of placating the gods. Sacrifices became far more important, and they assumed both public and domestic character. Therefore, option (D) is incorrect.