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Economics Cassava is the main commodity in the economy of Makandingi. Given the hardship in the economy, the government increased the salary of all employees
Economics Cassava is the main commodity in the economy of Makandingi. Given the hardship in the economy, the government increased the salary of all employees in Makandingi. Following this intervention, the number of cassava producers also increased in the community. In a class discussion, Barnabas said these tvvo events would result in an increase in equilibrium price of cassava. Francis, on the other hand, argued that the price would rather decrease. With the aid of a diagram, explain the possible effects of the two events on equilibrium price and quantity, assuming the salary increase has a greater impact and cassava is a normal good
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