The correct answer is A) decrease pump capacity. An increase in rotor clearances in a rotary pump will decrease the pump's volumetric efficiency, resulting in a decrease in the pump's capacity. This is because larger rotor clearances allow more fluid to leak back from the discharge side to the suction side of the pump, reducing the net flow delivered by the pump. The other answer choices are incorrect because: B) Increasing rotor clearances would not decrease pump cavitation, as cavitation is more related to the pump's suction side design. C) Increasing rotor clearances would not increase discharge pressure, as it would decrease the pump's ability to generate pressure. D) Reaction ring clearance is not directly affected by changes in rotor clearances.