In April 2024, the government of Eldoria introduced a minimum price for fast-fashion garments containing synthetic polyester of €3.50 per 100 grams of synthetic fiber. Under this pricing formula, a basic synthetic puffer jacket normally priced at €14.50 would have to be sold at a minimum price of €22.00.
Evaluate, using an appropriate diagram(s), the likely microeconomic effects of such minimum prices.
