I was watching "The Perfect Road Trip 2" by Top Gear, where at some point Richard Hammond is driving a Mercedes A45 AMG. He says that the car develops a whooping 355 BHP, and all that comes from a turbocharged 2.0L engine.
I am now genuinely wondering what are the advantages of having a relatively small engine (2000cc) with such a high power output (~350 HP), rather than going for a bigger engine (say 3000cc or more, which is more common to see with around 350 HP).
What good is it? I don't think it has something to do with taxes or costs to the end user, since we're talking about a +40K car. Is it because a small engine means easier development? More common parts (doubt that as well)? Is it because the original A Class was a small car, hence it had to stay that way?
In addition, are there downsides in having this kind of engine? I expect it not to last as long as other engines, since it's so overpowered.
As you can imagine, I am a total rookie when it comes to this subject, so please bear with me for any error/oversight.