Gce Model Questions Vol1 2024 Commerce Question 2

Practice essay / theory question 2 from the 2024 Gce Model Questions Vol1 Commerce examination. This question covers Export‑import analysis, Terms of trade, Tariff impact, Trade policy recommendation .

Gce Model Questions Vol1 2024 Commerce Essay / Theory
Topics: Export‑import analysis Terms of trade Tariff impact Trade policy recommendation
Question 2 GCE_MODEL_QUESTIONS_VOL1 • 2024 • COMMERCE • essay

The table below shows Nigeria’s export and import data for two primary commodities – cocoa and rubber – for the years 2022 and 2023. | Commodity | Year | Quantity (tonnes) | Price per tonne (US$) | Value (US$ millions) | |-----------|------|-------------------|-----------------------|----------------------| | Cocoa (Export) | 2022 | 200,000 | 2,500 | 500 | | Cocoa (Export) | 2023 | 220,000 | 2,700 | 594 | | Rubber (Export) | 2022 | 150,000 | 1,800 | 270 | | Rubber (Export) | 2023 | 140,000 | 1,900 | 266 | | Cocoa (Import) | 2022 | 50,000 | 2,800 | 140 | | Cocoa (Import) | 2023 | 55,000 | 2,900 | 159.5 | | Rubber (Import) | 2022 | 120,000 | 2,000 | 240 | | Rubber (Import) | 2023 | 130,000 | 2,100 | 273 | Answer the following questions.

Question Parts

( a )
Calculate the percentage change in the export value of cocoa from 2022 to 2023. Show your working.
( b )
Determine Nigeria’s terms of trade for 2022 and for 2023 (using the ratio of total export value to total import value, expressed as a percentage). State whether the terms of trade have improved or deteriorated in 2023 and briefly explain why.
( c )
The government is considering a 10 % ad‑valorem tariff on imported rubber. Using the 2023 import quantity, calculate the new price per tonne of rubber after the tariff and the resulting total import value. Discuss two likely effects of this tariff on (i) Nigeria’s balance of trade and (ii) domestic consumer prices for rubber‑based products.
( d )
Based on your calculations and discussion, recommend whether Nigeria should pursue diversification of its export basket. Justify your recommendation with reference to the data.

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About This Question

This is Gce Model Questions Vol1 2024 Commerce Question 2. It is one of the essay questions from the 2024 Gce Model Questions Vol1 Commerce examination.

The question covers Export‑import analysis, Terms of trade, Tariff impact, Trade policy recommendation .

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