Carlo and the spice trade

Friday, October 17, 2014


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This is an easy case.

In 1502 Carlo finally achieved his life’s ambition and bought a beautiful ship with which he intended to travel to India, following the route discovered by Vasco da Gama,  where he would acquire spices in exchange for the silver and trinkets that he would be taking with him. These spices would fetch good money on his return.





Using his budget for the voyage;

   Complete a spreadsheet

   Prepare his financial statements

   and calculate some ratios

Now become a detective and reveal the physical facts which underly the financial numbers.

Advise Carlo how his voyage could be made even more profitable!

Working papers and answers are provided for you.

A little bit of history.

 For hundreds of years merchants brought their spices overland along the the Spice Road from India to Trezibond, a port on the Black Sea.There they were sold to merchants from Venice and the prices were high. Then Vasco da Gama discovered a direct sea route, going down the coast of Africa, round the Cape Of Good Hope, and across the sea to India.

This meant that Carlo, and other merchants, could follow this route and buy directly from the growers at Kerela, in India,. This enabled them to undercut the high prices that were being charged at Trezibond. It was a long way; the return journey would take over a year. Dangerous? Yes, but it should be a profitable one.

Vasco da Gama’s home port was Lisbon, so now the spice trade was carried out from there. Hence Carlo had to go to Lisbon to sell his cargo, before returning to Venice.