1 .The primary aim of the ECBs monetary policy is to maintain price stability.

(a) Define the term monetary policy.

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(b) Outline two benefits of price stability for the Irish economy.

(i) ___________________________

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(ii) ___________________________

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2 . (a) Outline two possible economic effects of the Irish government introducing a levy on home

insurance premiums to help address damage caused by the recent flooding crisis in Ireland.

(i) ___________________________

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(ii)___________________________

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(b) Suggest one alternative method for addressing the flooding crisis in Ireland.

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3 .. "The national minimum wage is increased by 50 cent, bringing it to 9.15 in a bid to make work pay."

(Source: Irish Independent, October 2015)

Outline three possible economic impacts of this measure on the Irish economy.

(i)___________________________

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(ii)___________________________

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(iii)____________________

4 .(i) State a market structure which most closely reflects the situation above, giving a

reason for your answer.

(ii) Outline two other key characteristics of this market structure.

(iii) Explain, with the aid of a labelled diagram, the likely shape of the demand curve in this

market structure.

(b) (i) If a large US chocolate manufacturer entered the EU chocolate market, outline the possible

economic impacts of greater competition in this market.

(ii) Outline two factors which could make it difficult for this US chocolate manufacturer

to enter the EU chocolate market.

(c) Explain why small firms succeed in some markets while other markets are dominated by

large firms.

[04:35, 01/09/2021] Erico: 5 (a) (i) Show, by means of a labelled diagram, the market demand and supply curves for

games consoles e.g. Xbox, PlayStation, Nintendo DS. Identify and explain the market

equilibrium position.

(ii) Explain, with the aid of a separate diagram in each case, the effects which each of the

following is most likely to have on the above equilibrium position:

50% reduction in the price of computer games used with the games console;

Quota placed on the quantity of games consoles entering Ireland;

Government introduce a 2% levy (tax) on all income earned. (30 marks)

(b) (i) Define income elasticity of demand and price elasticity of demand.

(ii) Which figure stated below is most likely to represent each of the following:

Income elasticity of demand for low price cuts of meat;

Income elasticity of demand for Apple iPhones;

Price elasticity of demand for Petrol.

- 1.6 - 0.1 + 4.3 Give reasons for your choice in each case.

(c) Assume Income elasticity of demand for games consoles is + 2.5 and total sales in 2008 were

100,000 units.

Calculate the expected total sales for the year if consumers' incomes are expected to fall by 8%

in 2009. Show your workings.