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The demand and supply curves for the market are given by: Demand: Qd = 16000 24P Supply: Qs = 2000 + 32P A maximum

The demand and supply curves for the market are given by:
Demand: Qd = 16000 – 24P
Supply: Qs = 2000 + 32P
A maximum price of $200 is proposed.

(e) Does the imposition of the maximum price result in net welfare gains? Explain. (4 marks)
(f) Would you advise the implementation of the maximum price? Explain. (3 marks)
(g) Suggest an alternate strategy. (2 marks)

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