A frozen-food company is planning to export ice cream to retailers on an island 1,200 miles from its home country. It can send a full refrigerated container...
Question 1 Report
A frozen-food company is planning to export ice cream to retailers on an island 1,200 miles from its home country. It can send a full refrigerated container by sea or use air freight. The business expects regular orders but customers want low prices.
(a) State the type of goods being transported. [1]
(b) Calculate the number of miles travelled for a return sea journey. [2]
(c) Explain why sea freight is likely to be the better option for the company. [6]
Answer Details
(a) Ice cream is a perishable good, specifically frozen food. [1]
(b)
\[1200\text{ miles} \times 2=2400\text{ miles}\]
The return sea journey is 2400 miles. [2]
(c) Sea freight is likely to be preferable because:
- A full container sent by sea is cheaper than air freight, helping the business keep retail prices low. [2]
- Ships carry large volumes, so regular orders can be sent together in bulk. [2]
- A refrigerated container keeps the ice cream frozen, reducing spoilage and waste during the long journey. [2]
Air freight may be faster, but its higher cost could reduce profit or force the business to charge customers more. [6]
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