Recommend which international market AP should expand into, country P or country T. Justify your recommendation.

Mark scheme

Marking points from the official mark scheme (Oct/Nov 2022). The mark or mark type is shown in brackets.

1. [K] Understanding of international market.
2. [K] Importance of international market for AP.
3. [K] Understanding of joint venture with agents, direct investment.
4. [K] Understanding of tariffs, exchange rate, economic growth, subsidy, grants, role of trade unions, indirect taxes.
5. [K] Possible aims and content of market research.
6. [App] AP's objective of growth and profit.
7. [App] AP is leading supplier in country Z.
8. [App] Use of relevant data from Table 2. NB not just quoting data but comparisons such as: 20% of Country P's population of 20m are under 15, compared to 15% of Country T's population of 30m. So, Country P has 4m people under 15, which is lower than the 4.5m in Country T.
9. [App] Use of relevant data from Table 2. NB not just quoting data but comparisons such as: Marketing cost is $0.5m higher in Country P.
10. [App] Use of relevant data from Table 2. NB not just quoting data but comparisons such as: Economic growth is 2% higher in Country T.
11. [An] Comparison of strengths/weaknesses of differing entry methods: joint venture with agents v direct investment in factory.
12. [An] Comparison of advantages and disadvantages of the economic factors in Table 2 for AP if exporting.
13. [An] Appreciation of country Z's currency against country P will make it more difficult to export over time as less price competitive.
14. [An] Government grant available in country T will reduce the cost of expansion.
15. [An] Comparison of marketing costs and possible market size based on population figures – country T has a larger population under the age of 15 and so there is more potential for sales.
16. [An] Comparison of strength of competition in countries P and T.
17. [Eval] Justified recommendation on choice of country.
18. [Eval] Most important factor in the decision.
19. [Eval] Justified recommendation to seek more detailed market information as no sales data given.
20. [Eval] Need more information on forecast effectiveness of marketing campaigns.
21. [Eval] Important factor of attitude of governments in P and T not detailed.
22. [Eval] More information needed on costs/availability of factory or suitable agents.
23. [Eval] Either option fit with AP's objective of growth and AP is leading supplier in country Z so time is right for international expansion.
24. [Eval] Justified conclusion of neither at this time.