General equilibrium occurs in autarky at the point where the community indifference curve intersects the production possibilities frontier.

Question

Quizplus · Accepted Answer

General equilibrium refers to the state of economic balance where all markets in an economy are in simultaneous equilibrium. In autarky, there are no markets, so general equilibrium cannot be achieved. Additionally, the intersection point of the community indifference curve and the production possibilities frontier only represents one allocation of resources, and does not necessarily correspond to a state of equilibrium.

General Equilibrium Occurs in Autarky at the Point Where the Community