Final answer:
In economics, TRUE equilibrium refers to a stable market state where supply equals demand, resulting in a stable price. METASTABLE equilibrium is a temporary, less stable condition. In a world without trade, equilibrium price and quantity would be found where the domestic supply curve meets the demand curve, indicating no excesses or shortages.
Step-by-step explanation:
The term TRUE equilibrium refers to the state in an economy or marketplace where supply meets demand, and there are no excesses or shortages, leading to a stable price level for goods and services. On the other hand, METASTABLE equilibrium (though the term 'metastarif' appears to be a typo or a misunderstanding as 'metastable' is the correct term) is a temporary condition where the market is not in its most stable state, and small changes can move the market toward a more stable equilibrium.
In a world without trade, the equilibrium price and quantity would be determined solely by the domestic demand and supply within each country. In such a scenario, you could tell the equilibrium by finding the point at which the supply curve meets the demand curve for each particular market. At this point, the quantity demanded by consumers is equal to the quantity supplied by producers, leading to no excess supply or demand, which dictates the equilibrium price and quantity.
Markets are generally effective at reaching equilibrium through the interaction of supply and demand, effectively allocating resources and determining prices. However, the fairness of market outcomes is subject to debate as externalities, market power, or information asymmetries can disrupt the efficiency and perceived fairness of market-driven equilibria.
LibreTexts suggests comparing the new equilibrium conditions to the original to understand the impacts of changes in market conditions. A new equilibrium with a lower price and quantity indicates that there was either a decrease in demand or an increase in supply, moving the market to a new equilibrium position.