Podcast
Questions and Answers
What happens to the demand for Irish exports when the euro weakens?
What happens to the demand for Irish exports when the euro weakens?
- It remains unchanged as the price of exports is unaffected.
- It becomes unstable and fluctuates constantly.
- It increases as exports become cheaper in other countries. (correct)
- It decreases as exports become more expensive.
What happens to the cost of production for Irish firms when the euro weakens?
What happens to the cost of production for Irish firms when the euro weakens?
- It increases as essential raw materials become more expensive. (correct)
- It remains the same as the cost of production is unaffected.
- It decreases as imports become cheaper.
- It becomes unstable and fluctuates constantly.
What happens to tourism in Ireland when the euro weakens?
What happens to tourism in Ireland when the euro weakens?
- It decreases as tourists from foreign countries find Ireland more expensive.
- It becomes unstable and fluctuates constantly.
- It increases as tourists from foreign countries find Ireland cheaper. (correct)
- It remains unchanged as tourism is unaffected by currency fluctuations.
What happens to Ireland's external debt when the euro weakens?
What happens to Ireland's external debt when the euro weakens?
What could be a potential long-term effect of a weakening euro?
What could be a potential long-term effect of a weakening euro?
What is a likely consequence for Irish exporting firms when the euro weakens?
What is a likely consequence for Irish exporting firms when the euro weakens?
What is a likely effect of a weaker euro on the price of imports in Ireland?
What is a likely effect of a weaker euro on the price of imports in Ireland?
How does a weaker euro affect the cost of Ireland's external debt?
How does a weaker euro affect the cost of Ireland's external debt?
What is a potential outcome of a weaker euro for the Irish economy as a whole?
What is a potential outcome of a weaker euro for the Irish economy as a whole?
Why do tourists from foreign countries benefit from a weaker euro?
Why do tourists from foreign countries benefit from a weaker euro?
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Study Notes
Weakening Euro Impacts on Irish Economy
- A weaker euro makes eurozone exports cheaper in other countries, increasing demand and potentially leading to higher employment in exporting firms.
- Foreign imports become more expensive, resulting in decreased demand, but essential raw materials still need to be imported, increasing production costs for Irish firms.
- Tourism in Ireland from foreign countries increases as a weaker euro makes holidays cheaper for tourists, for example, Americans get more value for their dollars.
- External debt becomes more expensive to repay as the euro depreciates, making it costlier to repay loans in foreign currencies.
- A weakening currency can stimulate economic growth through boosted exports and tourism, but also risks inflation due to higher import prices.
Weakening Euro Impacts on Irish Economy
- A weaker euro makes eurozone exports cheaper in other countries, increasing demand and potentially leading to higher employment in exporting firms.
- Foreign imports become more expensive, resulting in decreased demand, but essential raw materials still need to be imported, increasing production costs for Irish firms.
- Tourism in Ireland from foreign countries increases as a weaker euro makes holidays cheaper for tourists, for example, Americans get more value for their dollars.
- External debt becomes more expensive to repay as the euro depreciates, making it costlier to repay loans in foreign currencies.
- A weakening currency can stimulate economic growth through boosted exports and tourism, but also risks inflation due to higher import prices.
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