A country's newest ruler has decided the country will become self-sufficient and ceases trade with the rest of the world.The likely outcome of this action will be that the country's citizens will be:

Question

Quizplus · Accepted Answer

By ceasing trade with the rest of the world, the country is now producing all the goods it consumes domestically. If the country had a comparative advantage in producing a good, it could have imported that good and consumed more of it at a lower cost. By producing everything domestically, the country is likely to have higher production costs, which will lead to higher prices for goods and services. This will force citizens to consume less than before, especially if they had a comparative advantage in the production of a good.

A Country's Newest Ruler Has Decided the Country Will Become