Use your knowledge of supply/demand analysis to examine what might occur in the
following situation. Explain your answer. AMX car manufacturing company is
launching a new model. It expects to sell 1000 cars per period of time. The list price
of the new car is €20k. As events turn out demand is better than expected and AMX
could sell 1500 cars per period of time. What might happen in the market for this new
car due to this event and explain your answer.
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The Irish economy is characterised by very high unemployment at present (just under
14% of the labour force). The economy is also characterised by a large public sector
borrowing requirement. It has been argued that Government should stimulate the
economy to reduce this unemployment. Discuss the arguments for and against such a
proposal.
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