Gce Model Questions Vol1 2022 Commerce Question 4

Practice essay / theory question 4 from the 2022 Gce Model Questions Vol1 Commerce examination. This question covers Foreign Trade .

Gce Model Questions Vol1 2022 Commerce Essay / Theory
Topic: Foreign Trade
Question 4 GCE_MODEL_QUESTIONS_VOL1 • 2022 • COMMERCE • essay

An import firm in Nigeria plans to import 2,000 units of an electronic component from Japan. The FOB price is ¥5,500 per unit. The current exchange rate is ₦0.55 per ¥1. Shipping costs ₦12,000 in total and insurance is charged at 0.4 % of the CIF value. Import duty is 15 % of the CIF value and VAT is 7.5 % of the sum of CIF value and duty.

Question Parts

( a )
Calculate the landed cost per unit in Naira and the selling price per unit if the firm applies a 30 % markup on the landed cost.
( b )
If the exchange rate rises by 5 % (from ₦0.55 to ₦0.5775 per ¥1), recalculate the landed cost per unit and the new selling price with the same 30 % markup. Comment on the impact of the exchange‑rate change on the firm’s profitability.

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About This Question

This is Gce Model Questions Vol1 2022 Commerce Question 4. It is one of the essay questions from the 2022 Gce Model Questions Vol1 Commerce examination.

The question covers Foreign Trade .

View More Gce Model Questions Vol1 2022 Commerce Questions More Gce Model Questions Vol1 Practice Questions Back to Questions

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