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GCE JUN 2007 : (AS 4) E-Commerce

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ADVANCED SUBSIDIARY (AS) General Certificate of Education 2007 GCE Applied Business assessing E-Commerce A3B41 Assessment Unit AS 4 [A3B41] THURSDAY 7 JUNE, MORNING TIME 1 hour 30 minutes. INSTRUCTIONS TO CANDIDATES Write your Centre Number and Candidate Number on the Answer Booklet provided. Answer all five questions. INFORMATION FOR CANDIDATES The total mark for this paper is 80. Quality of written communication will be assessed in questions 3(b), 4 and 5. Figures in brackets printed down the right-hand side of pages indicate the marks awarded to each question or part question. ADVICE TO CANDIDATES You are advised to take account of the marks for each part question in allocating the available examination time. A3B4S7 2890 E-Commerce and eBay eBay is The World s Online Marketplace with a global customer base of 181 million. Founded in 1995, eBay has created a powerful marketplace for the sale of goods and services by a passionate community of individuals and small businesses. eBay now has a global presence in 33 markets, including the United States. On any given day, there are millions of items listed on eBay across thousands of diverse categories, including antiques, toys, books, computers, sports, photography and electronics, amongst many others. As an early Internet enthusiast, Pierre knew that people needed a central location to buy and sell all kinds of items on a level playing field and to meet other users with similar interests. He started eBay to fulfil this need. At the time, Pierre s fianc e (now wife) was an avid PezTM (sweet dispenser) collector. She was having trouble finding people to trade with, and Pierre thought eBay might be the answer to her problems. eBay.co.uk was launched in October 1999, and is now the UK s largest online market place, becoming the UK s number one e-commerce site (Nielsen/Netratings, May 2003). It has also achieved the three million live listings landmark, meaning there are three million items for sale on the site at any given time. eBay hit the 10 million users milestone in February 2005, achieving the three million live listings landmark. Recent research reveals its popularity with internet users showing every third internet user visits eBay.co.uk at least once a month (Nielsen/Netratings, April 2005). The UK site has over 13 000 categories and is a top brand name on the Internet according to calculations by the Internet monitoring company Envisional (Envisional, April 2005). The site s audience continues to grow, reaching 11.5 million in January 2006 (Nielsen/Netratings, January 2006). eBay.co.uk s reach was 42.3% in January 2006 (Nielsen/Netratings, January 2006) reach is the percentage of all active internet users within that month visiting eBay.co.uk. Visitors to the site average 1 hour 45 minutes on the site and view 280 pages per month (Nielsen/Netratings, July 2005). Users in the UK, as is true in Germany, spend more time on eBay than any other website (Nielsen/Netratings, April 2005). In the UK, eBay accounts for 10% of all the time users spend on the internet (Nielsen/Netratings, April 2005). Popularity of this site is evident because users in the UK spend more money on eBay than going to the cinema (Screen International). In 2004, the gross merchandise volume (GMV), the value of all successfully closed listings on eBay.co.uk, reached a staggering $3.7 billion, and continues to develop at a very strong pace; in the process it has reached an important milestone. The UK achieved its first ever $100M revenue quarter in the second quarter. eBay.co.uk reported year-over-year GMV growth of 94% (eBay Inc Facts and Figures). A3B4S7 2890 2 [Turn over Source: http://www.ebay.co.uk Fig. 1 Screen shot of the home page of eBay A3B4S7 2890 3 [Turn over 1 (a) Explain what is meant by the term E-Commerce . Give an example of how it is used by eBay. [4] (b) Explain what is meant by the term Internet . Give an example of how it is used by eBay. [4] 2 Discuss three hardware costs and three software costs, which would have been incurred by eBay when going on-line. [12] 3 (a) Explain the main differences between the Intranet and Extranet , and show how an organisation like eBay might use them. [8] (b) Discuss two reasons why eBay would use search engine optimisation. [8] 4 Discuss the key issues that eBay would need to consider when evaluating the effectiveness of their website [20] 5 On-line trading has many advantages for eBay. Discuss these with reference to the case study. [24] Permission to reproduce all copyright material has been applied for. In some cases, efforts to contact copyright holders may have been unsuccessful and CCEA will be happy to rectify any omissions of acknowledgement in future if notified. S 3B4S7 2890 A 8/06 7-096-1 4 [Turn over

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Additional Info : Gce Applied Business June 2007 Assessment Unit AS 4 - E-Commerce
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