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Brexit will occur formally in March 2019 - Leaving Cert Economics - Question c - 2018
Question c
Brexit will occur formally in March 2019. (i) What is meant by the term Brexit? (ii) Irish exporting firms may have to deal with tariffs and quotas. Explain each o... show full transcript
Worked Solution & Example Answer:Brexit will occur formally in March 2019 - Leaving Cert Economics - Question c - 2018
Step 1
What is meant by the term Brexit?
Answer
Brexit refers to the United Kingdom's decision to leave the European Union. This decision was made through a public referendum in June 2016, and it implies that the UK will no longer be subject to EU laws and regulations. The formal exit is set to occur in March 2019.
Step 2
Explain each of the underlined terms: tariffs
Answer
Tariffs are taxes imposed on imported goods. They are used by governments to increase the price of foreign products, making them less competitive against domestic goods. This can impact pricing strategies for businesses involved in import-export activities.
Step 3
Explain each of the underlined terms: quotas
Answer
Quotas are limits set by governments on the amount of a particular product that can be imported. By restricting supply, quotas help protect local industries from foreign competition, which can affect supply chains and market dynamics for businesses that rely on imports.
Step 4
State and explain one economic challenge, other than tariffs and quotas, which an Irish exporting firm may have following Brexit.
Answer
One economic challenge that Irish exporting firms may encounter following Brexit is increased transport costs. Given Ireland's geographical situation as an island nation, additional logistics may be required to move goods to and from the UK. This can result in higher shipping fees and longer delivery times, complicating trade and potentially affecting profit margins for businesses engaged in exporting.