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Transportation Logistics

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Answer 50 questions in 15 minutes.
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Match each statement with the correct term.
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This is a study tool. The 3 wrong answers for each question are randomly chosen from answers to other questions. So, you might find at times the answers obvious, but you will see it re-enforces your understanding as you take the test each time.

1. Value of Service pricing
The intermodal competition has increased dramatically since WW 2
563
15%~13%
Pricing according to product value or demand - higher value of the product - the higher the transportation price (risk of loss/damage..). Third Degree price discrimination: separate price for separate groups of buyers with same service. Must posses

2. Certificate of origin
After World War 2
Containers moving between Far East & Europe via ship - rail - ship instead of all water through Panama Canal - Use continent U.S. as bridge (move by train) - Save Transit time - fuel - & Liner ship investment
Declaration of where product was made so that appropriate duties are charged
Switching - Piggybacking - Double-Stacking - Car-Loading - Trackage - Haulage - Drayage - Demurrage

3. UNCTAD liner code 40-40-20
Water (Barge Ships) at 0.72 per ton mile. The second lowest is Rail at 2.24 cents per ton mile.
Transfers accountability between domestic and international carrier at the terminal
80 - 000 lbs
40% each to trade partners & 20% to 3rd world country to develop 3rd world ocean shipping industry - it happened to be inefficient.

4. Name the 3 types of water carriers
Yes
Free on Board- Origin (seller pays shipping costs); Destination (Buyer pays).
Coastal/Intercoastal - Great Lakes - Internal
1850-1950

5. Starting from which cargo weight and movement distance does it normally make sense to ship by rail?
1. Setting prices on new services- consider cost and market elasticity; no precedent 2. Modification of prices over time- respond to market/operating/service changes 3. Initiating and responding to price changes- impact on market share and profits.
30 - 000 lbs and 300 miles
Amenities/Accommodations - Direct flights to destination without layovers - More personal space in flight - In flight service personnel - No frills types of service (no perks)
The number of unions and the degree of their involvement in operations and labor management contributes to inefficiencies of the railroads

6. Factors affecting Pricing decisions
The pickup and delivery of trailers and containers in conjunction with a line-haul rail movement
Market Forces (customers) - Governmental Controls - Other channel member - Competition.
Economies of scale
1. Setting prices on new services- consider cost and market elasticity; no precedent 2. Modification of prices over time- respond to market/operating/service changes 3. Initiating and responding to price changes- impact on market share and profits.

7. What do the users of truck service benefit?
The trends in supply chain management called for faster and more frequent services and smaller inventories - so many shippers preferred trucks - - The newly built system of inland waterways swayed cost-conscious shippers to less expensive barge tran
Accessibility - Speed - Universal Connector - Reliability - Frequency - Lower Loss and Damage Rates - Lower Inventory levels due to smaller shipments than other modes
Substantially higher
Used for tax - manning - and relaxed regulation.

8. On the average - per gallon of fuel - US railroads move a ton of freight...
Economies of scope and density
484
About 2 cents per dollar
Break bulk - Relay - Pick up - Delivery

9. Which type of railroad cargo has the highest tonnage share in the US?
Coal - farm products - chemicals - transportation equipment
Liner Shipping- ply fixed routes on published schedule - Tramp Shipping- charter ships - lease based on time or voyage - Private Vessels- ship registry; flags of convenience for regulations.
Coal
Maximize the utilization of equipment - increase the efficiency of equipment operations - save transit time and operational costs.

10. Ways to classify the motor carriers
Alcoholism in the workplace - Challenges of implementing new technology - Need to increase customer service - Challenges of growing intermodal service
Society and customer first.
LTL vs TL - Local vs Intercity Carriers - Publicly owned vs Privately owned - Specialized vs general freight
Main penalty is the cost of lost of sales by holding the shipment.

11. Benefits of hub and spoke system
Moderate
Truck safety requirements - Driver hours of service - User fee charges - Reduction of pollution from trucks
Maximize the utilization of equipment - increase the efficiency of equipment operations - save transit time and operational costs.
Motor/Truck - around 69-70% - Revenue % for Rail: 5.6%

12. Line of credit process

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13. Cost of Service Pricing
Motor/Truck - around 69-70% - Revenue % for Rail: 5.6%
563
Increased use of technology - Gradual increase in the number of smaller railroads - Increase in intermodal shipments - Sharp growth in fuel efficiency of locomotives
Pricing according to cost incurred to serve - Customer covers all costs - seller sets prices to maximize profits.

14. Factors contributing to the decline of Railroad use
Main penalty is the cost of lost of sales by holding the shipment.
The development of the highway system - Limited access points - Long transit times - Safety of cargo during transit
anywhere between a quarter and a third of all highway travel
Truck safety requirements - Driver hours of service - User fee charges - Reduction of pollution from trucks

15. What commodity/goods are typically transported by railroads in the US?
90-s
Coal - farm products - chemicals - transportation equipment
Transfer of function to another country - can stay within the same company!
About 2 cents per dollar

16. What aspects of the trucking industry is the US involved in?
Moderate
1850-1950
A trucking operation that only hauls freight for the firm which owns it
Truck safety requirements - Driver hours of service - User fee charges - Reduction of pollution from trucks

17. Government is involved in which aspects of the railroad business?
Safety regulations - Evaluating fairness of disputed charged rates - Monitoring profitability of railroads - and Mergers and acquisitions
11 hours straight or anything beyond 70 hours in 8 days
Class 1 - Regional - Shortline - Switching and Terminal
Gov't aid to develop air service - Gov't funding of highways - Construction of inland waterways - Growing preference of shippers for more frequent deliveries and smaller shipments

18. Which economies are present in the US railroad industry?
Gov't aid to develop air service - Gov't funding of highways - Construction of inland waterways - Growing preference of shippers for more frequent deliveries and smaller shipments
Economies of scale
Coal - farm products - chemicals - transportation equipment
Accompanies shipment - Bill for the goods from the seller to the buyer - Often used by government to determine the true value of goods when assessing customs duties

19. What is a public benefit of railroads?
The use of two or more modes to move a shipment from origin to destination. -Malcom McLean first move freight by truck and rail in 1950.
Reduced highway congestion - damage and pollution as a result of replacing trucks as an alternative
Not the government - the railroads themselves
Wyoming

20. Far-shoring
Accompanies shipment - Bill for the goods from the seller to the buyer - Often used by government to determine the true value of goods when assessing customs duties
Carloads and Ton-miles
Completely different continent - different time zones.
Transfers accountability between domestic and international carrier at the terminal

21. Which US federal government agency enforces safety regulations for railroads?
Covering variable costs - volume and equipment utilization - and cash flow.
Labor and Fuel
Cargo can fit in an enclosed van trailer - Food - consumer staples - manufactured goods
Federal Railroad Administration (FRA)

22. Freight Revenue for Rail (per ton-mile)
Labor and Fuel
About 2 cents per dollar
Special Rates
Motor: HH Goods - Heavy Machinery - Petroleum Products - Dump Trucking - Ag Commodities - Motor Vehicles - Retail Store Delivery

23. What is the current share of trucking in total transportation expenses is closest to...
90-s
83.8%
Showed a marked decline
ton-miles

24. How to assess the operating ratio?
The competition is intense in both TL and LTL segments
The closer the operating ratio is to 100 - the more indicative of the possible need to raise rates to increase total revenues
Consolidation of shipments to different destinations within the same general area.
Amtrak is a US government business since 1971 - created to ease the burden on private railroads by taking over money-locing passenger transportation in exchange for the right to operate Amtrak trains over their networks

25. LTL terminals are used for connections with these operations...
NTSB
15
Break Bulk - Pickup and Delivery - Line Haul - Slip-Seating
Seller asks buyer for l/c - buyer asks its bank to issue l/c - after approving buyer's credit line - buyer's bank notifies seller's bank it has issued l/c - seller's bank either adds confirmation or simply advises seller that l/c has been issued

26. What is Amtrak?
Commercial invoice printed on stationery of importing country's consulate and stamped by consulate.
Class 1 - Regional - Shortline - Switching and Terminal
The intermodal competition has increased dramatically since WW 2
Amtrak is a US government business since 1971 - created to ease the burden on private railroads by taking over money-locing passenger transportation in exchange for the right to operate Amtrak trains over their networks

27. Dock receipt
Odd numbers: North to South highways - increase from west to east - Even numbers: East to West highways - increase from south to north
Transfers accountability between domestic and international carrier at the terminal
Covered Hopper
Use of low-sulfur diesel fuel - Use of biodiesel fuel - Cutting down on idling - Reducing traffic congestion

28. Consular Invoice

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29. What factors lead to reduction of air pollution by trucks?
100 tons
Free on Board- Origin (seller pays shipping costs); Destination (Buyer pays).
The competition is intense in both TL and LTL segments
Use of low-sulfur diesel fuel - Use of biodiesel fuel - Cutting down on idling - Reducing traffic congestion

30. Which mode has the lowest cost per ton mile?
Consolidation
FedEx - YRC - Conway - UPS - ABF
250 - 000
Water (Barge Ships) at 0.72 per ton mile. The second lowest is Rail at 2.24 cents per ton mile.

31. The problem of driver shortage in the US...
Is likely to stay and even get worse in the future
Coastal/Intercoastal - Great Lakes - Internal
Far east to east coast or Europe to west coast - final destination is US port city
Consolidation

32. In terms of tonnage moved by the whole US transportation - the share of railroads is close to this rounded number...
Market Forces (customers) - Governmental Controls - Other channel member - Competition.
15%~13%
250 - 000
High price for price insensitive customers.

33. What are the two primary operational indicators in the railroad industry?
Transfer of function to another country - can stay within the same company!
anywhere between a quarter and a third of all highway travel
Carloads and Ton-miles
The intermodal competition has increased dramatically since WW 2

34. Which phrase best characterizes the level of competition in the motor carrier industry?
Gov't aid to develop air service - Gov't funding of highways - Construction of inland waterways - Growing preference of shippers for more frequent deliveries and smaller shipments
Alcoholism in the workplace - Challenges of implementing new technology - Need to increase customer service - Challenges of growing intermodal service
The competition is intense in both TL and LTL segments
Accompanies shipment - Bill for the goods from the seller to the buyer - Often used by government to determine the true value of goods when assessing customs duties

35. How many Class 1 freight railroads are there?
Break bulk - Container service - LASH service (lighter aboard ship) - RORO service (roll on/off ship).
Water (Barge Ships) at 0.72 per ton mile. The second lowest is Rail at 2.24 cents per ton mile.
Cargo can fit in an enclosed van trailer - Food - consumer staples - manufactured goods
7

36. Which modes have the following cost structure: Low Variable and High Fixed?
To save the railroads by giving them a chance to compete with other modes on equal footing
Pipeline and Rail
Yes
Consolidation of shipments to different destinations within the same general area.

37. What could be the rationale for railroad mergers?

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38. Trackage

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39. Consolidation
Water (Barge Ships) at 0.72 per ton mile. The second lowest is Rail at 2.24 cents per ton mile.
Main penalty is the cost of lost of sales by holding the shipment.
The pickup and delivery of trailers and containers in conjunction with a line-haul rail movement
Transfer of function to another country - can stay within the same company!

40. What are the generally accepted classifications of railroads?
Specialized: $73 Billion - General: $146 Billion
Economies of scope and density
Class 1 - Regional - Shortline - Switching and Terminal
Amtrak is a US government business since 1971 - created to ease the burden on private railroads by taking over money-locing passenger transportation in exchange for the right to operate Amtrak trains over their networks

41. What are the current trends in trucking?
(Trucking) Class 1: income > $10M - Class 2: $3M<income<$10M
Increased use of technology - Gradual increase in the number of smaller railroads - Increase in intermodal shipments - Sharp growth in fuel efficiency of locomotives
Increased use of technology - Shorter length of haul - Growth of intermodal - Expected increase in rates due to expected capacity shortage - Convergence of LTL market with traditional integrators - Expanded menu of services - Active government lobbyi
Yes

42. What must be used in intervals when transporting pulverized coal mixed with water at long distances?
40% each to trade partners & 20% to 3rd world country to develop 3rd world ocean shipping industry - it happened to be inefficient.
Commercial Invoice - Pro-Forma Invoice - Consular Invoice
Consolidate orders for several customers and stop along the way for partial unloading.
A pumping station

43. Types and shares of cost in railroads
Line-Haul Vehicles: Tractor Trailer combination of 3 or more axles - City Straight Vehicles: Single Units - Special Vehicles: Dry Van - Open Top - Flatbed - Tank Trailer - Special
Fixed Costs: 30% - Semi-Variable Costs: 40% - Variable Costs: Labor and Gas
Highway user taxes
To promote interstate commerce and strengthen the defenses of the country

44. A pumping station requires 3-6000HP to move oil through a pipeline. To move more than 1 grade at same time what do you use?
A batching pig
Break bulk - Relay - Pick up - Delivery
Economies of scope and density
About 2 cents per dollar

45. Pro-Forma Invoice
Interior Non-port cities
Over reliance on costs - slow reaction to market changes - ignoring marketing mix - prices not tailored to services and markets - need to price according to strategic plan.
Not an invoice but a quote. must be carefully written to avoid discrepancies w/ L of C
Not the government - the railroads themselves

46. Bill of Lading
30%
A contract for transportation between a shipper and the carrier - also is a cargo receipt
Covered Hopper
Pricing according to product value or demand - higher value of the product - the higher the transportation price (risk of loss/damage..). Third Degree price discrimination: separate price for separate groups of buyers with same service. Must posses

47. 1 Barge is equivalent to how many tons?
Alcoholism in the workplace - Challenges of implementing new technology - Need to increase customer service - Challenges of growing intermodal service
Specialized: $73 Billion - General: $146 Billion
Bottlenecks - Traffic accidents - Major snowfalls - Projects to improve existing highways
1500 tons

48. Social Responsibility pricing
Declaration of where product was made so that appropriate duties are charged
Consolidation of shipments to different destinations within the same general area.
Society and customer first.
Commercial invoice printed on stationery of importing country's consulate and stamped by consulate.

49. Pricing adjustment conditions
Discounts: reduction from published price. Volume: TL vs LTL - Seasonal - Cash 2/10 net 30 - Geographical- FOB origin/destination - Uniform delivered pricing: zone pricing.
Is likely to stay and even get worse in the future
Liner Shipping- ply fixed routes on published schedule - Tramp Shipping- charter ships - lease based on time or voyage - Private Vessels- ship registry; flags of convenience for regulations.
Moving to neighboring country - NAFTA - because the places may have close cultural affinity.

50. At about what time did trucking become the predominant mode of transportation in the US by gradually surpassing the railroads in terms of tonnage and revenues?
After World War 2
High price for price insensitive customers.
Priority service schedule - often empty backhaul - often cars owned by the shipper - and direct movement from origin to destination
Attests to authenticity and accuracy of the goods. Performs by third party independent company