On March 2020, the Irish Government introduced the Pandemic Unemployment Payment to provide financial support for people who lost their job due to the COVID-19 pandemic. This program officially ended in March 2022. a) Discuss which of the models covered in class might be the most appropriate to study the effect of the introduction of the Pandemic Unemployment Payment on the economy. Represent graphically and explain the short-run and medium-run effects of this policy on the labor, goods and financial markets. [40 marks]

b) Based on the labor market effects discussed in point a), present a likely reason that motivates the Irish government to terminate the payment. [25 marks]

c) Based on the discussion in points a) and b), propose the design of a policy that would have the same expected effect on the Irish natural level of output and unemployment as the termination of the payment. [35 marks]