Lækkunin er líka mikil.

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

It is used here because lækkunin is a singular subject.

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

So grammatically, Lækkunin er ... means The reduction is ...

The base noun is lækkun, which means reduction, decrease, lowering.

The ending -in is the definite article attached to the noun, so:

• lækkun = a reduction / a decrease
• lækkunin = the reduction / the decrease

Unlike English, Icelandic usually puts the at the end of the noun instead of using a separate word.

Yes. It comes from the verb að lækka, which means to lower, to decrease, or sometimes to go down, depending on context.

So the relationship is:

• að lækka = to lower / to decrease
• lækkun = a lowering / a decrease / a reduction
• lækkunin = the lowering / the decrease / the reduction

This is a very common pattern in Icelandic: a verb and a related noun built from it.

Here, líka means also or too.

In Icelandic, líka often comes after the finite verb, which is why you get:

• Lækkunin er líka mikil.

That placement is very normal. English speakers often expect also in a slightly different place, but in Icelandic this word order is natural.

Compare:

• Hann er líka hér. = He is also here.
• Þetta er líka gott. = This is also good.

Because mikil has to agree with lækkunin in gender, number, and case.

Here, lækkunin is:

• feminine
• singular
• nominative

So the adjective must match that, giving mikil.

Compare the nominative singular forms:

• mikill = masculine
• mikil = feminine
• mikið = neuter

That is why mikið would not fit here.

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

In Icelandic, predicate adjectives normally use the strong form, even when the noun is definite.

So:

• Lækkunin er mikil. = correct

This is similar to other Icelandic sentences like:

• Bókin er góð. = The book is good.

Even though bókin is definite, the adjective after er is still the normal predicate form.

Not in a physical sense. With an abstract noun like lækkun, mikil usually means something like:

• large
• great
• considerable
• significant

So it describes the degree of the reduction, not physical size.

This is very natural Icelandic usage. English speakers might sometimes think of big first, but in context significant or substantial is often the better idea.

The sentence has a very normal Icelandic structure:

• Lækkunin = subject
• er = verb
• líka = adverb
• mikil = complement / adjective

So the sentence is built in a straightforward way.

Yes, Icelandic word order can change for emphasis, but the verb usually stays in second position in a main clause. For a learner, the given order is the safest and most natural one to use.

So:

• Lækkunin er líka mikil. = neutral and natural

Other orders may be possible in special contexts, but this is the standard pattern to learn first.