A、They didn’t arrive on time. B、They were all moldy and eaten by bugs. C、50% of the moldy mushrooms were eaten by bugs. D、Some w

W: Good morning, Mr. Brown.
   M: Good morning, Mrs. Smith. Be seated, please.
   W: Thank you. Mr. Brown, I’d like to talk with you about something that is getting to be a problem.
   M: What is it, Mrs. Smith?
   W: It’s about the quality of 300 cartons of dried mushrooms. They reached us two weeks ago, and were immediately examined after they arrived. To our astonishment, about 20% of them were moldy and in many cartons there were even small brown bugs crawling in and out of the half-eaten mushrooms. We can’t accept them in this state.
   M: Is that so? So far we haven’t had any complaint of this kind. Our mushrooms have enjoyed a good reputation for years. Have you any evidence?
   W: Certainly. Here’s a survey report by a well-known lab in London.
   M: Though everything may be as you say, there are many factors involved. What’s more, your surveyors have not mentioned any cause for the damage.
   W: It is stated on the surveyor’s report that external conditions of goods at the time of survey are all sound and intact. So it is obvious the cause of the damage is that the mushrooms were not completely dried before packaging.
   M: As you know, before shipment, the Commodity Inspection Bureau inspected the mushrooms. They concluded that the goods were well dehydrated and choice material was up to standard for export.
   W: I think they only selected a few packages. The 20% in question, most probably, escaped their attention. I think it is only reasonable that you should compensate us for the loss.
   M: But we both agreed on a random selection of 20% of the consignment beforehand. We do not accept any claims for compensation for loss incurred in transit. You know, the goods were bought on FOB basis. In my opinion, your claim should be referred to the insurance company for compensation.
   W: Actually, we’ve already got in touch with the underwriter. But they refused. They attributed the accident to the effects of dampness during the long sea voyage.
   M: Then I’m afraid I have to insist that you approach the insurance company for settlement, that is, if you have covered this risk in your coverage.
   W: To my regret, we failed to cover contamination. This is an unfortunate oversight on our part.
   M: Oh, I feel sorry for you.
   W: Well. It seems we’ll have to waive the claim.
   M: Okay. I hope everything will be smooth in our future business.
   W: I hope so. Er…Goodbye, Mr. Brown.
   M: Goodbye, Mrs. Smith.
   Questions 1 to 5 are based on Conversation One.
   1. Where is possibly the conversation held?
   2. What is the problem about the dried mushrooms?
   3. What can we know from the woman’s survey report?
   4. What did they agree before?
   5. Who may be responsible for the damage?