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Command economics can:

a. Never outperform free markets
b. Outperform free markets for long periods of time
c. Outperform free markets for short periods of time
d. Never underperform free markets
e. None of the above

1 Answer

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Final answer:

Command economies can outperform free markets for short periods, especially during market inefficiencies or rapid mobilization of resources, but generally lack long-term sustainability due to innovation and incentive deficits.

Step-by-step explanation:

Command economics can at times outperform free markets for short periods, particularly when the market is dealing with inefficiencies or when a centralized authority can mobilize resources quickly for a specific goal. However, command economies typically experience more stagnation than free markets due to lack of incentives for innovation and improvement, since resources and businesses are government-owned. This often results in a lack of dynamism and efficiency in the long run. Furthermore, command economies do not usually experience the highs and lows associated with the business cycle of free markets, implying more stability but also potentially less economic growth. The correct answer to the question is therefore: b. Outperform free markets for long periods of time, which acknowledges that while command economies can potentially excel in certain circumstances, this is usually not sustainable over long durations.

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