A UK publishing group has four divisions. The pound appreciates and every division keeps its sterling prices unchanged.
The table shows information about the four divisions.
| Division | Revenue from overseas customers (%) | Imported services as % of costs | Are overseas customers sensitive to price? |
|---|---|---|---|
| Audiobooks | 78% | 12% | Yes |
| Educational software | 82% | 68% | No |
| UK magazines | 15% | 20% | Yes |
| Translation services | 25% | 75% | No |
Which division faces the greatest risk of a fall in profit following the appreciation?
Educational software
Audiobooks
Translation services
UK magazines
118 exam-style questions on AQA GCSE Economics 2.4 International trade and the global economy, covering 2.4.1a The importance of trade, 2.4.1b Advantages of trade and interdependence, 2.4.1c UK exports and imports, 2.4.2a How exchange rates are determined, 2.4.2b Effects of exchange rate changes, 2.4.3a Free-trade and its arguments, 2.4.3b Free-trade agreements such as the EU, 2.4.4a Features and growth of globalisation, 2.4.4b Benefits and drawbacks of globalisation, and 2.4.4c Moral, ethical and sustainability considerations. Each one has a worked solution and a mark scheme showing where the marks go.