Cambridge IGCSE Commerce: Aids to Trade that Support Commerce — Practice Questions (0715)

These questions test every part of Topic 5, Aids to trade that support commerce, of Cambridge IGCSE Commerce (0715, 2028): advertising and sales promotion, banking and digital banking, insurance, and sources of finance with the six commercial calculations. Scenario questions follow the Paper 2 style of applying knowledge to a named business.

These are original questions written for Marlbridge, for revision and practice on this content. They are not reproduced past-paper questions, and they do not replicate the exam’s exact structure, question count or mark tariffs — examination boards hold copyright in their own papers. Use these alongside the official past papers available free from your board.

Related: Aids to trade study guide and revision notes

---

Section A - multiple choice

1. An advert by a national tea board saying “Tea - the nation’s favourite drink” is an example of: [1] A competitive advertising B collective advertising C informative advertising D sales promotion

2. A gym collects a different monthly fee from each member’s bank account depending on classes attended. This payment method is a: [1] A standing order B direct debit C credit transfer D cheque

3. Which document provides temporary insurance cover until the policy is issued? [1] A proposal form B cover note C letter of credit D debenture

Section B - structured questions

4. GlowSkin is launching a new sunscreen for teenagers in three countries. (a) Identify two suitable methods of digital advertising media and justify each. [4] (b) Explain two methods of appeal GlowSkin could use. [4] (c) Explain two cultural or legal considerations that could affect its advertising. [4]

5. Explain two sales promotion methods a new café could use in its first month. [4]

6. Amara, a market trader, wants to stop carrying large amounts of cash. (a) Explain two banking services that would help her. [4] (b) Discuss the impact of digital banking on small traders like Amara. [6]

7. Explain how an exporter could use documentary credit (a letter of credit) to reduce the risk of non-payment. [3]

8. Harbour Hardware insures its premises worth $250 000. The insurer charges $0.40 per $100 insured. (a) Calculate the annual premium. [2] (b) Explain how pooling of risk allows the insurer to pay claims. [3] (c) Identify two other types of insurance risk Harbour Hardware should cover and explain why. [4]

9. State the role of an insurance broker. [2]

10. The table shows Lotus Bags’ figures for one year.

Item	$
Units sold	4 000
Selling price per unit	25
Cost of sales	60 000
Expenses	22 000
Current assets	35 000
Current liabilities	20 000

Calculate: (a) revenue; (b) gross profit; (c) gross profit margin; (d) profit for the year; (e) working capital. [5]

11. Lotus Bags buys each bag for $15. Calculate the mark-up percentage. [2]

12. A young entrepreneur needs $40 000 to open a food truck. She has $5 000 savings. Evaluate two suitable sources of finance for her. [6]

13. Suggest two ways Lotus Bags could improve its profit for the year, explaining each. [4]

---

Answers

1. B. [1]

2. B. [1]

3. B. [1]

4. (a) Any two justified: social media advertising - teenagers spend time on these platforms and ads can be targeted by age [2]; social media influencers - trusted by young audiences [2]; video advertisements - can show the product being used [2]. [max 4] (b) Any two explained: social acceptance - using it makes you fit in with friends [2]; endorsement by influencers or celebrities [2]; fear - risk of sunburn [2]; adventure - beach and outdoor activities [2]. [max 4] (c) Any two explained: rules on health claims for skincare products [2]; laws on advertising to young people [2]; images or messages that offend cultural or religious values in one country [2]; language differences [2]. [max 4]

5. Any two explained: free samples to let people try the coffee [2]; coupons or special offers such as “buy one get one free” [2]; competitions on social media to build awareness [2]; point of sale displays [2]. [max 4]

6. (a) Any two explained: a current account to deposit takings safely [2]; a debit card or mobile payments so customers pay electronically [2]; a night safe to deposit cash after banking hours [2]. [max 4] (b) [6] Benefits: customers can pay by mobile, so less cash to carry and less theft; transfers are quick; records of sales are kept automatically; banking can be done at any time without visiting a branch. Drawbacks: some customers prefer cash; fees on transactions; network failures stop sales; risk of fraud; branch closures make face-to-face help harder. Conclusion: mostly positive if Amara has reliable internet access.

7. The importer’s bank promises to pay the exporter [1] once the exporter presents the shipping documents showing the goods were sent [1], so the exporter relies on the bank, not just the buyer [1].

8. (a) 250 000 / 100 x 0.40 = $1 000. [2] (b) Many businesses pay premiums into one fund [1]; only a few suffer losses in a year [1], so the fund is large enough to compensate them [1]. (c) Any two explained: theft - of tools and stock [2]; fire - damage to stock [2]; public liability - customers injured in the shop [2]; employer’s liability - staff injured at work [2]; consequential loss

• lost profit while closed after a fire [2]. [max 4]

9. An independent intermediary [1] who advises clients and finds the most suitable insurance policy for them [1].

10. (a) 4 000 x 25 = $100 000 [1]; (b) 100 000 - 60 000 = $40 000 [1]; (c) 40 000 / 100 000 x 100 = 40% [1]; (d) 40 000 - 22 000 = $18 000 [1]; (e) 35 000 - 20 000 = $15 000 [1].

11. (25 - 15) / 15 x 100 = 66.7%. [2]

12. [6] Bank loan: provides a large sum with fixed repayments, and she keeps full control; but needs security and interest raises costs. Crowdfunding: many people contribute online and it creates publicity for the food truck; but it may not reach the target and backers may expect rewards. Hire purchase or leasing for the truck itself: spreads the cost; but total cost is higher. Conclusion: a combination, such as savings plus a loan or hire purchase, is most realistic.

13. Any two explained: reduce expenses, such as cheaper rent or energy [2]; increase mark-up or change prices [2]; improve advertising to raise sales [2]; introduce new products [2]. [max 4]

A note on exam technique for this topic

In calculations, write the formula, substitute the numbers and give the unit ($ or %). In “evaluate” questions, weigh both sources or strategies against the scenario and finish with a justified choice.

Frequently asked questions

Which formulas must I learn for 0715 Topic 5? Revenue, gross profit, gross profit margin, profit for the year, working capital and mark-up percentage.

What is the difference between a cash discount and a trade discount? A cash discount rewards prompt payment. A trade discount is given to traders who buy goods for resale.

Is crowdfunding short-term or long-term finance? The 0715 syllabus lists crowdfunding as a source of long-term finance, with shares, loans, debentures and venture capital.

Official syllabus

Cambridge IGCSE Commerce (0715) syllabus for 2028 - official syllabus PDF.