3. During the recent 2022 Federal election in Australia, one political party said that it would cap interest rates paid by homeowners on personal mortgages. This idea is not new (see article below from 2016 - 'Cut Price Logic' https://www.economist.com/leaders/2016/09/08/cut-price-logic). Using your understanding of price controls, answer the following questions:

a What type of price control is being discussed in the article? Draw a simple model of the market for private loans as outlined in the article, including the price control.

b Using the same diagram, illustrate and describe what this might entail in the market for loans: '...with fewer options to choose from, some borrowers may turn instead to loan sharks...'