Q1 
QUESTION:
Referring to the graph, fully explain the consequences of a Maximum Price Control on the market for houses for rent. Include the following: quantity demanded before and after the price control/ quantity supplied before and after the price control/ a problem the price control might create and a possible solution for the problem outlined.
ANSWER:
The consequences of the Maximum Price Control on houses for rent is that the quantity demanded before the price control was 3500 houses and after 4000 houses. The quantity supplied of houses decreases from 3500 houses to 2500 houses. A problem created by the price control is a shortage of 1500 houses. A black market could arise because some customers are willing to pay a higher price that the legally set price of $350. Possible solutions to the shortage could be first-in-first-served, rationing or the government could give producers a subsidy and increase supply.
Q2 
QUESTION:
What would the difference between (P x Q) and (Maximum price x Qs) indicate?
ANSWER:
The change in the total value of sales after a maximum price was imposed.
Q3
QUESTION:
Explain why a maximum price may result in a black market.
ANSWER:
Some people are willing to pay more than the price set by government even though it is illegal.
Q4
QUESTION:
Explain how the market has been affected by the maximum price. Be specific.
ANSWER:
The price has decreased from $450 to $350. There will be a shortage of 3 000 houses. Quantity supplied falls by 1 000 houses. The value of sales changes by $700 000 (decrease).
Q5 
QUESTION:
Explain how the market has been affected by the maximum price. Be specific.
ANSWER:
The price has decreased from £40 to £30. There will be a shortage of 2 000 helmets. Quantity supplied falls by 1 000 helmets. The value of sales changes by £70 000 decrease.
Q6
QUESTION:
In the interest of lower income groups would the government set a maximum or minimum price on items of mass consumption?
ANSWER:
A maximum (ceiling) price.
Q7
QUESTION:
(i) How much has the quantity of cycle helmets being supplied to the market changed? (ii) What was the change in total value of sales after the maximum price was imposed?
ANSWER:
(i) Q vs Qs, 4 000 vs 3 000 = 1 000 helmets decrease. (ii) (P x Q) vs (Pmax x Qs) = £40 x 4 000 vs 30 x 3 000 = £160 000 vs £90 000 = £70 000 decrease