Gullið er dýrt.

Because Icelandic usually adds the definite article to the end of the noun instead of using a separate word like the.

• gull = gold
• gullið = the gold

Here, -ið is the neuter singular definite ending.

Gull is a neuter noun.

That matters because adjectives in Icelandic have to agree with the noun they describe. In this sentence, the adjective appears as dýrt, and that -t ending shows neuter singular agreement.

Because Icelandic adjectives change form to match the noun in gender, number, and case.

The dictionary form is usually dýr, but here the noun is:

• neuter
• singular
• nominative

So the adjective becomes dýrt.

Because dýrt is a predicate adjective: it comes after er and describes the subject.

After to be, Icelandic normally uses the adjective in its regular agreeing form here: dýrt.

Compare:

• Gullið er dýrt = the gold is expensive
• dýra gullið = the expensive gold

So when the adjective is directly before a definite noun, you get a different form.

Er is the present tense, 3rd person singular form of að vera, meaning to be.

So:

• ég er = I am
• þú ert = you are
• hann/hún/það er = he/she/it is

In this sentence, er simply means is.

It is in the nominative case because it is the subject of the sentence.

The adjective dýrt matches it, so it is nominative too.

Yes.

The difference is:

• Gull er dýrt = gold is expensive / gold is an expensive material
• Gullið er dýrt = the gold is expensive

So without -ið, the statement is more general. With -ið, it usually refers to specific gold already known from the context.

Because this sentence is built like:

• subject + verb + predicate adjective

So:

• Gullið = subject
• er = verb
• dýrt = adjective describing the subject

If you put the adjective before the noun, you get a noun phrase instead:

• dýrt gull = expensive gold
• dýra gullið = the expensive gold

That is different from saying the gold is expensive.

A rough English-friendly guide is:

• gullið ≈ gütl-ith
• er ≈ ehr
• dýrt ≈ deert

A few helpful notes:

• ý is pronounced like ee in see
• ll in words like gull does not sound like ordinary English ll; it has a special Icelandic sound, often approximated as tl
• the r in dýrt is not an English-style r; it is tapped or trilled

Not in this sentence.

Here, dýrt is the adjective from dýr, meaning expensive.

Icelandic also has a noun dýr, meaning animal, but that is a different word. This is a common thing for learners to notice, because the forms look very similar.

Yes. Icelandic, like English, often treats materials and substances as singular mass nouns.

So gull and gullið are singular here, even though they refer to a substance rather than a countable item.