If a market is in autarky equilibrium,an increase in supply will:

Question

Quizplus · Accepted Answer

If a market is in autarky equilibrium, it means that the local supply and demand are balanced and there are no imports or exports. An increase in supply means that there is more of the product available locally, which can lead to an increase in local production. However, since the demand is still the same, the price will decrease to clear the market. Therefore, the correct choice is D, where an increase in supply will increase local production but decrease the local price.

If a Market Is in Autarky Equilibrium,an Increase in Supply