CocoaVale Ltd imports cocoa priced in US dollars and exports chocolate to the USA. Table 1 shows changes after the pound appreciated against the dollar.
| Measure | Before appreciation | After appreciation |
|---|---|---|
| Exchange rate | $1.20 per £1 | ,$1.38 per £1 |
| Imported cocoa cost per batch | £7,500 | £6,520 |
| Monthly export orders | 12,000 boxes | 9,500 boxes |
Using Table 1, analyse the likely effects of the pound's appreciation on CocoaVale Ltd.
48 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.