Source A
GlobalTrade Solutions (GTS) is a multinational company that specialises in facilitating international trade. Founded in 2005, GTS has grown rapidly, establishing subsidiaries in over 50 countries. The company helps businesses navigate complex trade regulations, reduce tariffs, and access new markets. However, GTS has recently faced challenges due to increasing trade restrictions imposed by various governments. These restrictions, such as import quotas and tariffs, have made it more difficult for GTS to operate efficiently. Despite these obstacles, GTS continues to advocate for free trade, arguing that it promotes economic growth and development. The company's annual report highlights the negative impact of trade barriers on global commerce and consumer welfare.
Source B
| Country | Exports | Imports | Trade Balance |
|---|---|---|---|
| Veridia | |||
| Aquitania | |||
| Borealis | |||
| Lusitania | |||
| Gallia |
(a) Define the term 'globalisation' using information from Source A.
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Globalisation is the process of increasing interconnectedness and interdependence of the world's economies, cultures, and populations, brought about by cross-border trade and investment, and aided by technology. (1 mark for mentioning interconnectedness/interdependence, 1 mark for mentioning trade/investment/technology).
(b) Calculate the total exports of the countries listed in Source B.
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120 + 90 + 70 + 50 + 150 = 480 (2 marks for correct calculation).
(c) Explain two possible consequences of changes in globalisation using information from Source A.
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Two possible consequences of changes in globalisation are: 1. Increased difficulty in navigating trade regulations (2 marks for explanation, e.g., 'as globalisation changes, trade regulations become more complex, making it harder for companies like GTS to operate'). 2. Advocacy for free trade (2 marks for explanation, e.g., 'changes in globalisation may lead companies to advocate for free trade to promote economic growth and development').
(d) Analyse the role of multinational companies (MNCs) like GlobalTrade Solutions (GTS) in promoting globalisation using information from Source A.
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MNCs like GTS play a significant role in promoting globalisation by: 1. Facilitating international trade (1 mark for identification, 1 mark for explanation, e.g., 'GTS helps businesses navigate complex trade regulations'). 2. Reducing tariffs and accessing new markets (1 mark for identification, 1 mark for explanation, e.g., 'GTS helps businesses reduce tariffs and access new markets, promoting globalisation').
(e) Describe two types of trade restrictions mentioned in Source A and explain their impact on global commerce.
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Two types of trade restrictions mentioned in Source A are: 1. Import quotas (1 mark for identification, 1 mark for explanation, e.g., 'import quotas limit the number of goods that can be imported, reducing the supply of goods in the domestic market'). 2. Tariffs (1 mark for identification, 1 mark for explanation, e.g., 'tariffs are taxes imposed on imported goods, making them more expensive and reducing their competitiveness in the domestic market').
(f) Evaluate the consequences of trade restrictions on consumer welfare and economic growth, using information from both sources.
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Model answer (Level of Response Mark Scheme): High Level (3-4 marks): The student evaluates the consequences of trade restrictions on consumer welfare and economic growth, using information from both sources. They may argue that trade restrictions can lead to higher prices and reduced variety of goods for consumers (1 mark for identification, 1 mark for explanation), and can hinder economic growth by reducing trade and investment (1 mark for identification, 1 mark for explanation). They may also discuss the potential benefits of trade restrictions, such as protecting domestic industries (1 mark for identification, 1 mark for explanation). Mid Level (2 marks): The student describes the consequences of trade restrictions on consumer welfare and economic growth, using information from both sources. They may mention that trade restrictions can lead to higher prices and reduced variety of goods for consumers, and can hinder economic growth by reducing trade and investment. Low Level (1 mark): The student identifies one consequence of trade restrictions on consumer welfare or economic growth, using information from one source.