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O-LevelCommerceGlobal trade7100/22 · May/June 2025 · Q314 Marks

FF Ltd is a food processing company in India. It has received a $30 million export order for canned meat from a new customer in the United States.

  1. (a)Explain what is meant by an export order.[2]
  2. (b)Describe how FF Ltd will contribute to India's Balance of Trade.[2]
  3. (c)Explain the effect on FF Ltd if the United States introduces import quotas on canned meat from India.[2]
  4. (d)FF Ltd is experiencing a delay with the delivery of this export order and needs to communicate with the customer. Evaluate whether FF Ltd should use written or oral communication to communicate with the customer. Discuss both options. Which option do you recommend? Give reasons for your answer.[8]

Mark scheme

Marking points from the official mark scheme (May/June 2025). The mark or mark type is shown in brackets.

  1. [1] A document of international trade acts as a request/order made by the importer/buyer in one/foreign country/another country
  2. [1] to buy/order/import goods from another/different country
  3. [1] FF Ltd is exporting more goods to United States/adding to the total exported goods/visible goods of the country/increasing exports/by $30 million/more foreign exchange
  4. [1] India has a balance of trade surplus/favourable/positive/improves balance of trade
  5. [1] Quotas place a limit on the number/volume of imported canned meat from India
  6. [1] reduces the quantity of goods that FF Ltd can export/import into United States/leading to less revenue/sales/profits for FF Ltd/less dumping of goods on the United States market by FF Ltd
  7. [1] Oral communication is two-way communication/face-to-face/directly speaking/telephoning or talking to someone
  8. [1] Written communication may be handwritten, typed, printed or electronically generated such as letters and email.
  9. [1] FF Ltd can have a discussion with the importer so that any points not understood can be clarified
  10. [1] There is direct contact so less confusion
  11. [1] It can give immediate impact/feedback so that a decision on the delivery issue can be reached quickly
  12. [1] It is interactive so is likely to be more effective for both parties
  13. [1] Body language can be observed helping to show person's feelings
  14. [1] There is no written record so agreed points may be misheard or misunderstood
  15. [1] The communication may be poorly organised leading to confusion
  16. [1] There may be network problems leading to delays
  17. [1] Potential language differences leading to less understanding
  18. [1] A written record is kept that both parties so useful for future reference if there is an error so less chance of misunderstanding
  19. [1] It allows time for planning a response to the delivery problem so that appropriate feedback can be given
  20. [1] Multiple copies can be sent to several people so making it cost-effective
  21. [1] Less possibility of information being distorted so fewer chances of misunderstandings/disputes
  22. [1] Instant feedback is not usually possible so delaying response to problem
  23. [1] There is more time to prepare/deliver message so there may be delay in replying
  24. [1] Emails can go into junk folder so delaying communication
  25. Evaluation: It is not known whether the delivery issue is urgent but if so, it is recommended that they use a method of oral communication, such as telephone, to gain immediate contact. If not quite so urgent, a written communication method, such as an email, might be used so a written record is created. A written form would be best when there is a problem so there cannot be any later confusion/disagreement.

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About this question

Topic
Global trade, O-Level Commerce (syllabus 7100). Structured question, 14 marks.
Source
O-Level Commerce, May/June 2025 Paper 2 Variant 2, question 3.

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