AQA A-level Geography · 3.2.1

International trade, market access and TNCs

Exam-style questions with answers for 3.2.1 International trade, market access and TNCs in AQA A-level Geography (spec 7037). Practise with flashcards, a topic quiz, a random quiz across the course, 5 crosswords, or read every question and answer below.

All questions and answers

Question 1 · Spec 3.2.1.3 · Trade patterns
Describe the global trends in the volume of international trade. [3 marks]
Answer:
International trade has grown much faster than world GDP since 1950 (1); there were falls during the 2008–09 financial crisis and in 2020 during the pandemic, followed by recovery (1); trade in services and digital products is growing faster than trade in goods (1).
Question 2 · Spec 3.2.1.3 · Trade patterns
Describe the main patterns of world trade in goods. [3 marks]
Answer:
Asia, led by China, now has the largest share of exports (1); the EU, North America and East Asia form the main trading regions (1); low-income countries account for only a small share of world trade (1).
Question 3 · Spec 3.2.1.3 · Trade patterns
Explain what is meant by a trading bloc and give two examples. [3 marks]
Answer:
A group of countries that agree to reduce or remove trade barriers between members (1); the EU and USMCA are examples (1); ASEAN and Mercosur are other examples (1).
Question 4 · Spec 3.2.1.3 · Trade patterns
Describe the trading relationship between the USA and the European Union. [3 marks]
Answer:
It is the largest bilateral trade and investment relationship in the world (1); the USA and EU trade large volumes of high-value goods and services, such as machinery, cars, pharmaceuticals and financial services (1); firms in each have large investments in the other's economy, and disputes arise over tariffs and subsidies (1).
Question 5 · Spec 3.2.1.3 · Trade patterns
Describe the trading position of China. [3 marks]
Answer:
China has been the world's largest exporter of goods since 2009 (1); it exports manufactured goods such as electronics, machinery and clothing to markets in Europe, North America and Asia (1); it imports raw materials, food and energy, for example from Africa, Australia and Brazil (1).
Question 6 · Spec 3.2.1.3 · Trade patterns
Describe the trading relationship between China and Africa. [3 marks]
Answer:
China has been Africa's largest trading partner since 2009 (1); Africa exports oil and minerals such as copper and cobalt to China (1); China exports manufactured goods to Africa and funds infrastructure such as roads, railways and ports (1).
Question 7 · Spec 3.2.1.3 · Trade patterns
Describe the trading position of India. [3 marks]
Answer:
India is a major exporter of services, especially IT and business services (1); it also exports pharmaceuticals, textiles and refined oil products (1); it imports crude oil, gold and electronics, and has a trade deficit in goods (1).
Question 8 · Spec 3.2.1.3 · Trade patterns
Describe the trading position of sub-Saharan Africa. [3 marks]
Answer:
Africa has less than 3% of world trade (1); most exports are primary commodities such as oil, minerals and cash crops (1); imports include manufactured goods, machinery and processed food (1).
Question 9 · Spec 3.2.1.3 · Trade patterns
Explain why dependence on primary commodities can be a problem for developing countries. [4 marks]
Answer:
Prices of commodities change sharply with weather and global demand, so export income is unstable (1); raw materials earn less than processed goods, so countries gain little value (1); the terms of trade tend to worsen when manufactured imports rise in price faster than exports (1); a country dependent on one product is vulnerable if its price collapses, as Zambia is with copper (1).
Question 10 · Spec 3.2.1.3 · Trade patterns
Explain the term terms of trade. [2 marks]
Answer:
The relationship between the average price of a country's exports and the average price of its imports (1); the terms of trade worsen when export prices fall relative to import prices (1).
Question 11 · Spec 3.2.1.3 · Trade patterns
The export price index of a country is 120 and the import price index is 150. Calculate the terms of trade and explain what the result means. [3 marks]
Answer:
Terms of trade = export price index ÷ import price index × 100 (1); 120 ÷ 150 × 100 = 80 (1); it is below 100, so the terms of trade have worsened and the country can buy fewer imports with its exports (1).
Question 12 · Spec 3.2.1.3 · Trade patterns
Describe the trade in services and its importance. [2 marks]
Answer:
Services such as finance, tourism, IT and education are traded across borders and are growing quickly (1); the UK, USA and India are major exporters of services (1).
Question 13 · Spec 3.2.1.3 · Access to markets
Distinguish between tariffs, quotas and subsidies. [3 marks]
Answer:
Tariffs are taxes on imported goods (1); quotas limit the quantity of a good that can be imported (1); subsidies are payments to domestic producers that allow them to sell more cheaply (1).
Question 14 · Spec 3.2.1.3 · Access to markets
Explain what is meant by tariff escalation. [2 marks]
Answer:
Tariffs rise as a product becomes more processed (1); this discourages developing countries from exporting processed goods and keeps them dependent on raw materials, such as cocoa beans rather than chocolate (1).
Question 15 · Spec 3.2.1.3 · Access to markets
Explain how non-tariff barriers can restrict access to markets. [2 marks]
Answer:
Rules on food safety, labelling and standards can be costly for small producers to meet (1); customs checks and paperwork delay trade and increase costs (1).
Question 16 · Spec 3.2.1.3 · Access to markets
Explain how subsidies in the EU and USA disadvantage farmers in developing countries. [3 marks]
Answer:
Subsidised farmers in rich countries can sell cheaply, lowering world prices (1); cotton producers in West Africa, such as in Mali and Burkina Faso, cannot compete (1); cheap subsidised food exports can also undercut local farmers in poor countries (1).
Question 17 · Spec 3.2.1.3 · Access to markets
Explain how differential access to markets is linked to levels of economic development. [3 marks]
Answer:
Wealthy countries and trading blocs can protect their own industries and negotiate better terms (1); developing countries have less bargaining power and often face higher barriers on processed goods (1); preferential schemes help some of the poorest countries but with conditions (1).
Question 18 · Spec 3.2.1.3 · Access to markets
Describe the role of the World Trade Organization. [3 marks]
Answer:
It sets and enforces rules for trade between its members, which number over 160 (1); it negotiates agreements to reduce tariffs and barriers (1); it settles trade disputes between countries, although talks such as the Doha Round have stalled (1).
Question 19 · Spec 3.2.1.3 · Access to markets
Describe the EU's Everything But Arms scheme. [2 marks]
Answer:
Introduced in 2001, it gives the least developed countries duty-free and quota-free access to the EU market for all products except arms (1); it aims to boost exports and development in poor countries such as Bangladesh and Cambodia (1).
Question 20 · Spec 3.2.1.3 · Access to markets
Explain how Fairtrade aims to improve access to markets. [3 marks]
Answer:
Producers receive a guaranteed minimum price and a premium for community projects (1); long-term contracts give farmers security (1); critics say only part of the premium reaches the producer and certification is expensive for the smallest farmers (1).
Question 21 · Spec 3.2.1.3 · Access to markets
Explain how unequal access to markets affects economic and societal well-being. [4 marks]
Answer:
Low export income limits government spending on health and education (1); farmers and workers are paid low wages, keeping them in poverty (1); few jobs in processing mean limited development of industry (1); people may migrate in search of work, causing brain drain and family separation (1).
Question 22 · Spec 3.2.1.3 · Access to markets
Explain how trade agreements can have both positive and negative effects on well-being. [3 marks]
Answer:
Lower tariffs can bring cheaper goods and more jobs in export industries (1); local industries that cannot compete may close, causing unemployment (1); agreements may favour larger, richer partners and weaken protection for workers and the environment (1).
Question 23 · Spec 3.2.1.3 · Access to markets
Describe how the UK's departure from the EU single market changed its trade. [3 marks]
Answer:
New customs checks and paperwork made trade with the EU slower and more costly (1); small firms in particular found exporting to the EU more difficult (1); the UK has signed new trade agreements with other countries and joined the CPTPP in 2024 (1).
Question 24 · Spec 3.2.1.3 · Access to markets
Explain how the trade tensions between the USA and China since 2018 have affected global trade. [3 marks]
Answer:
The USA placed tariffs on many Chinese goods and China responded with tariffs on US exports (1); some firms moved production to Vietnam, Mexico and India (1); uncertainty and higher costs reduced investment and slowed trade growth (1).
Question 25 · Spec 3.2.1.3 · Access to markets
Evaluate whether free trade benefits all countries equally. [4 marks]
Answer:
Free trade allows countries to specialise, giving consumers lower prices and wider choice (1); export industries grow and create jobs (1); however, poor countries may struggle to compete against wealthy ones and become dependent on a few products (1); the gains within countries are often uneven, with some regions and workers losing out (1).
Question 26 · Spec 3.2.1.3 · TNCs
Define the term transnational corporation. [2 marks]
Answer:
A company that has operations in more than one country (1); its head office is usually in one country, while production, sales and research take place in several (1).
Question 27 · Spec 3.2.1.3 · TNCs
Describe the spatial organisation of a typical TNC. [4 marks]
Answer:
The head office is in a high-income country, such as the USA or Japan (1); research and development take place near universities or skilled labour (1); production is often in low-cost locations such as China, Vietnam or Mexico (1); marketing and sales operate in many countries, with regional offices (1).
Question 28 · Spec 3.2.1.3 · TNCs
Explain why TNCs locate production in developing countries and newly industrialised countries. [3 marks]
Answer:
Labour costs are lower (1); governments may offer tax breaks, special economic zones and cheap land (1); locating near growing markets reduces transport costs and avoids trade barriers (1).
Question 29 · Spec 3.2.1.3 · TNCs
Explain what is meant by production linkages in a TNC. [2 marks]
Answer:
The links between the stages of production, from raw materials and components to assembly and distribution (1); some are within the company and others are with independent suppliers, which may be local or foreign (1).
Question 30 · Spec 3.2.1.3 · TNCs
Explain the term intra-firm trade and transfer pricing. [3 marks]
Answer:
Intra-firm trade is trade between branches of the same TNC in different countries (1); transfer pricing sets the prices charged between branches (1); firms can use it to record profits in low-tax countries and reduce their tax bills (1).
Question 31 · Spec 3.2.1.3 · TNCs
Explain what is meant by glocalisation. [2 marks]
Answer:
Adapting global products and marketing to suit local tastes and cultures (1); for example, McDonald's sells vegetarian burgers in India (1).
Question 32 · Spec 3.2.1.3 · TNCs
Describe the benefits that TNCs can bring to host countries. [4 marks]
Answer:
Jobs are created, directly and in supplier industries (1); wages are often higher than local firms pay (1); transfer of technology and skills improves the workforce (1); tax payments and exports earn income, and infrastructure may be improved (1).
Question 33 · Spec 3.2.1.3 · TNCs
Describe the costs that TNCs can bring to host countries. [4 marks]
Answer:
Wages may be low, with poor working conditions (1); profits may be sent out of the country (1); TNCs may pay little tax, and can leave quickly if costs rise (1); local businesses may be undercut, and the environment may be damaged (1).
Question 34 · Spec 3.2.1.3 · TNCs
Explain how TNCs affect their home countries. [3 marks]
Answer:
Head office and research jobs are kept, and profits return to shareholders (1); jobs in manufacturing may be lost when production is moved overseas (1); the TNC can have political influence and bring in tax revenue (1).
Question 35 · Spec 3.2.1.3 · TNCs
Explain how tax avoidance by TNCs affects governments. [3 marks]
Answer:
Firms use transfer pricing and tax havens to move profits to low-tax countries (1); governments lose income that could be used for public services (1); small local firms that pay full tax are at a disadvantage, and in 2024 the EU Court ruled that Apple owed Ireland about €13 billion (1).
Question 36 · Spec 3.2.1.3 · TNC case study
Apple: describe the spatial organisation of the company. [4 marks]
Answer:
The headquarters is in Cupertino, California, where products are designed (1); components come from many countries, including chips from Taiwan and screens and memory from South Korea (1); final assembly is carried out by contractors such as Foxconn, mainly in China, with growing production in India and Vietnam (1); products are sold through its own stores and online in over 100 countries (1).
Question 37 · Spec 3.2.1.3 · TNC case study
Apple: describe its production linkages. [3 marks]
Answer:
Apple does not own most of its factories but contracts firms such as Foxconn and Pegatron (1); suppliers in many countries make components, which are sent to the assembly plants (1); finished products are flown to markets worldwide to meet launch dates (1).
Question 38 · Spec 3.2.1.3 · TNC case study
Apple: explain the impacts on China. [3 marks]
Answer:
Millions of jobs have been created in assembly plants such as Zhengzhou (1); Chinese suppliers have gained skills and technology (1); there have been concerns about long hours, low pay and worker suicides at the Foxconn plants in 2010 (1).
Question 39 · Spec 3.2.1.3 · TNC case study
Apple: explain the impacts on other countries in which it operates. [3 marks]
Answer:
India and Vietnam gain jobs and investment as production moves there, and Apple reduces its dependence on China (1); mining of minerals in Africa and South America for batteries and electronics raises environmental and labour concerns (1); Ireland benefited from European operations, but was ordered to collect unpaid tax from Apple (1).
Question 40 · Spec 3.2.1.3 · TNC case study
Apple: describe its marketing and trading patterns. [3 marks]
Answer:
It sells premium products under a single global brand with launches planned worldwide (1); it earns a large share of its income from services such as the App Store (1); intra-firm trade and intellectual property are used to transfer profits between its subsidiaries (1).
Question 41 · Spec 3.2.1.3 · TNC case study
Apple: describe criticisms made of the company and its responses. [3 marks]
Answer:
Critics highlight poor working conditions in supplier factories and e-waste (1); Apple publishes supplier audits and sets standards for suppliers, and asks to see action on hours and child labour (1); it has set targets to use recycled materials and become carbon neutral across its supply chain by 2030 (1).
Question 42 · Spec 3.2.1.3 · TNC case study
Nike: describe the structure of the company and its impact on Vietnam. [3 marks]
Answer:
Nike designs and markets its products from its headquarters in Oregon, but contracts independent factories to make them (1); Vietnam makes about half of Nike footwear, employing hundreds of thousands of workers (1); the jobs have raised incomes, but there are concerns about low wages and overtime (1).
Question 43 · Spec 3.2.1.3 · Commodity: coffee
Describe the pattern of world trade in coffee. [3 marks]
Answer:
Coffee is grown in the tropics, with Brazil the largest producer, followed by Vietnam and Colombia (1); it is exported mainly as raw green beans (1); the main consumers and importers are the EU and USA, where it is roasted, packaged and sold (1).
Question 44 · Spec 3.2.1.3 · Commodity: coffee
Explain why coffee farmers receive a small share of the final price. [3 marks]
Answer:
Raw beans are low in value, and most of the value is added by roasting, branding and retail in rich countries (1); traders, exporters and multinational roasters take much of the profit (1); small farmers sell individually, with little bargaining power (1).
Question 45 · Spec 3.2.1.3 · Commodity: coffee
Explain how coffee price changes affect producers. [3 marks]
Answer:
Prices rise and fall with weather, harvests and speculation, such as frost or drought in Brazil (1); when prices fall, farmers may not cover costs and fall into debt (1); some abandon coffee or migrate, which affects local communities (1).
Question 46 · Spec 3.2.1.3 · Commodity: garments
Describe the trade in clothing from Bangladesh. [3 marks]
Answer:
Bangladesh is one of the world's largest garment exporters, with clothing about 80% of export earnings (1); it exports mainly to the EU, USA and UK (1); the industry employs millions of workers, mostly women, in factories near Dhaka and Chittagong (1).
Question 47 · Spec 3.2.1.3 · Commodity: garments
Explain what the Rana Plaza disaster showed about global supply chains. [3 marks]
Answer:
In 2013 a factory building collapsed near Dhaka, killing over 1,100 garment workers (1); the factories made clothes for Western brands that had demanded low prices and fast delivery (1); it led to the Bangladesh Accord on Fire and Building Safety and to greater pressure on brands to check conditions (1).
Question 48 · Spec 3.2.1.3 · Everyday lives
Explain how international trade affects the lives of students in the UK. [3 marks]
Answer:
Clothes, phones and food are imported, which gives cheaper prices and greater choice (1); jobs in UK industries depend on exports or global supply chains, while some manufacturing jobs have gone overseas (1); the goods consumed can have environmental and labour impacts in producer countries (1).
Question 49 · Spec 3.2.1.3 · Access to markets
Describe the African Growth and Opportunity Act (AGOA). [2 marks]
Answer:
Introduced by the USA in 2000, it gave eligible sub-Saharan African countries duty-free access to the US market for thousands of products (1); it aimed to boost exports such as clothing from Lesotho and Kenya, but eligibility depended on conditions set by the USA (1).
Question 50 · Spec 3.2.1.3 · Access to markets
Explain what is meant by dumping in international trade. [2 marks]
Answer:
Selling goods abroad at a price below the cost of production or below the price charged at home (1); importing countries may respond with tariffs to protect their own industries (1).

← 3.2.1 Globalisation and global systems 3.2.1 Global governance and the global commons →

International trade, market access and TNCs

All questions and answers

More AQA A-level Geography topics

Cookies on Knowledge Noodles

Cookie settings