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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. What is the approximate number of railroads in the US?
563
Used for tax - manning - and relaxed regulation.
To save the railroads by giving them a chance to compete with other modes on equal footing
An agreement whereby one railroad pays another for the right to operate its trains over the second carrier's track

2. What are the current trends in trucking?
Pipeline and Rail
About 25 cents per dollar
90-s
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

3. What was the rationale behind passing the Staggers Act of 1980?
Switching - Piggybacking - Double-Stacking - Car-Loading - Trackage - Haulage - Drayage - Demurrage
Declaration of where product was made so that appropriate duties are charged
To save the railroads by giving them a chance to compete with other modes on equal footing
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.

4. Cost of Service Pricing
Pricing according to cost incurred to serve - Customer covers all costs - seller sets prices to maximize profits.
A contract for transportation between a shipper and the carrier - also is a cargo receipt
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 closer the operating ratio is to 100 - the more indicative of the possible need to raise rates to increase total revenues

5. What could be the rationale for railroad mergers?

6. What is the current share of trucking in total transportation expenses is closest to...
Cash in advance - Letter of Credit - Documentary collection - Open account - TradeCard
Slip-Seating - Bob-Tailing - Hub-And-Spoke System - Drop-and-Hook
83.8%
Discounts: reduction from published price. Volume: TL vs LTL - Seasonal - Cash 2/10 net 30 - Geographical- FOB origin/destination - Uniform delivered pricing: zone pricing.

7. What are the service and public benefits of the railroad industry?

8. Name the 3 types of water carriers
Coastal/Intercoastal - Great Lakes - Internal
To save the railroads by giving them a chance to compete with other modes on equal footing
Less than 25 carriers handle 75 to 80% of total freight dollar.
ton-miles

9. Commercial Invoice
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
Water (Barge Ships) at 0.72 per ton mile. The second lowest is Rail at 2.24 cents per ton mile.
Highway user taxes
Economies of scale

10. Freight Revenue for Rail (per ton-mile)
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
A contract for transportation between a shipper and the carrier - also is a cargo receipt
About 2 cents per dollar
Covering variable costs - volume and equipment utilization - and cash flow.

11. Intermodal Transportation
Wyoming
After World War 2
Accessibility - Speed - Universal Connector - Reliability - Frequency - Lower Loss and Damage Rates - Lower Inventory levels due to smaller shipments than other modes
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.

12. Class Rate Calculations
Moderate
Provides rate for any commodity between any two points 1) Geogrphic: rate basis points and numbers 2) Commodity: commodity classification - class ratings 3) Rate structure: national scale of rates - cwt-based.
A longer combination vehicle towing more than one trailer
ton-miles

13. What is a typical fixed cost item in the motor carrier industry?
Terminal
Labor and Fuel
Coal
30%

14. LTL terminals are used for connections with these operations...
Few carriers handle more than 25% of total shipment - service disruptions problems if cease operation.
Break Bulk - Pickup and Delivery - Line Haul - Slip-Seating
Break bulk - Relay - Pick up - Delivery
(Trucking) Class 1: income > $10M - Class 2: $3M<income<$10M

15. Which economies are most prominent in the trucking industry?
Break Bulk - Pickup and Delivery - Line Haul - Slip-Seating
Continuous straight line movement - minimize intermediate handlings - maximize the full capacity of equipment - consolidation and break-bulk activities - empty mileage should be minimized - movement should be scheduled and dispatched.
Economies of scope and density
An agreement whereby one railroad pays a second carrier to transport its freight using the second carrier's crew and power equipment

16. Pro-Forma Invoice
Consolidation of shipments to different destinations within the same general area.
Not an invoice but a quote. must be carefully written to avoid discrepancies w/ L of C
Interior Non-port cities
100 cars x 100 tons

17. Survival Based pricing
Covering variable costs - volume and equipment utilization - and cash flow.
Service levels - Frequent flyer programs - Timing of flights - In advance registration
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
Specialized: $73 Billion - General: $146 Billion

18. Three kinds of ocean carriers
Less than 25 carriers handle 75 to 80% of total freight dollar.
Moving a corporations internal activities to outside providers - mainly for cheap labor
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.
Slip-Seating - Bob-Tailing - Hub-And-Spoke System - Drop-and-Hook

19. Price variation factors in airline service
Alcoholism in the workplace - Challenges of implementing new technology - Need to increase customer service - Challenges of growing intermodal service
Economies of scale
Service levels - Frequent flyer programs - Timing of flights - In advance registration
1850-1950

20. Major commodities hauled by each mode
484
Motor: HH Goods - Heavy Machinery - Petroleum Products - Dump Trucking - Ag Commodities - Motor Vehicles - Retail Store Delivery
Completely different continent - different time zones.
15

21. What is a road train?
Safety regulations - Evaluating fairness of disputed charged rates - Monitoring profitability of railroads - and Mergers and acquisitions
Service levels - Frequent flyer programs - Timing of flights - In advance registration
A longer combination vehicle towing more than one trailer
Moving to neighboring country - NAFTA - because the places may have close cultural affinity.

22. What must be used in intervals when transporting pulverized coal mixed with water at long distances?
Pricing according to cost incurred to serve - Customer covers all costs - seller sets prices to maximize profits.
A longer combination vehicle towing more than one trailer
11 hours straight or anything beyond 70 hours in 8 days
A pumping station

23. What are the characteristics of a block train?
With both - there are intermediary stops in between a route that serve as loading/consolidating or unloading of passengers/goods and then they are moved on to their final destinations.
Priority service schedule - often empty backhaul - often cars owned by the shipper - and direct movement from origin to destination
About 25 cents per dollar
Commercial invoice printed on stationery of importing country's consulate and stamped by consulate.

24. Categories of major pricing decisions
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.
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
Used for tax - manning - and relaxed regulation.
Coal

25. Types of vehicles for trucking
Yes
Wyoming
7%
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

26. What factors lead to reduction of air pollution by trucks?
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
Wyoming
Moderate
Use of low-sulfur diesel fuel - Use of biodiesel fuel - Cutting down on idling - Reducing traffic congestion

27. What is an approximate capacity of a hopper?
Continuous straight line movement - minimize intermediate handlings - maximize the full capacity of equipment - consolidation and break-bulk activities - empty mileage should be minimized - movement should be scheduled and dispatched.
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
100 tons
Break Bulk - Pickup and Delivery - Line Haul - Slip-Seating

28. The problem of driver shortage in the US...
30%
Is likely to stay and even get worse in the future
Consolidate orders for several customers and stop along the way for partial unloading.
(Trucking) Class 1: income > $10M - Class 2: $3M<income<$10M

29. Examples of general freight
The number of unions and the degree of their involvement in operations and labor management contributes to inefficiencies of the railroads
Substantially higher
Cargo can fit in an enclosed van trailer - Food - consumer staples - manufactured goods
BNSF - CSX Transportation - Kansas City Southern Railway - Grand Truck Corporation - Norfolk Southern - Union Pacific Railroad - Soo Line Railroad

30. 1. Character of shipment rates: LTL/TL rates - multiple-car rates - incentive rates - unit train rates - density rates... 2. Area - location or route rates: Local rates - joint rates - proportional rates - differential rates - per mile rate.
About 2 cents per dollar
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
11 hours straight or anything beyond 70 hours in 8 days
Special Rates

31. Funding the railroads?
Move 1 single commodity and are non-stop to destination.
Not the government - the railroads themselves
Pipeline and Rail
Highway user taxes

32. Consolidation
Main penalty is the cost of lost of sales by holding the shipment.
Covered Hopper
The closer the operating ratio is to 100 - the more indicative of the possible need to raise rates to increase total revenues
1850-1950

33. _____ mode is ideal for moving electronics - expensive items - flowers - or time sensitive materials such as organs
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
An agreement whereby one railroad pays another for the right to operate its trains over the second carrier's track
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
Air

34. Government is involved in which aspects of the railroad business?
Highway user taxes
Special Rates
BNSF - CSX Transportation - Kansas City Southern Railway - Grand Truck Corporation - Norfolk Southern - Union Pacific Railroad - Soo Line Railroad
Safety regulations - Evaluating fairness of disputed charged rates - Monitoring profitability of railroads - and Mergers and acquisitions

35. Trackage

36. Which government agency will investigate a major railroad accident involving public safety?
Boxcar - Hopper Car - Covered Hopper - Flatcar - Gondola - Tank Car
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
NTSB
High price for price insensitive customers.

37. Skimming pricing
Consolidate orders for several customers and stop along the way for partial unloading.
Coal
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
High price for price insensitive customers.

38. What is the approximate share of fixed costs of US railroads?
Air carrier: highest at 80.4% - Truck: 26.6% - Rail:2.24% - Barge Ship: .72% - Oil Pipeline: 1.47%
30%
Yes
563

39. The status of competition within the US railroad industry?
An agreement whereby one railroad pays a second carrier to transport its freight using the second carrier's crew and power equipment
The number of unions and the degree of their involvement in operations and labor management contributes to inefficiencies of the railroads
Moderate
1850-1950

40. Which modes have the following cost structure: Low Variable and High Fixed?
Commercial Invoice - Pro-Forma Invoice - Consular Invoice
Expanding capacity to benefit from large volume traffic efficiencies and economies of scale - Strengthening financial position and eliminating duplication through side-by-side mergers - Ensuring fair intramodal competition through 'soft' mergers - St
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.
Pipeline and Rail

41. What is the empirical formula of the typical coal unit train in the US?
Provides rate for any commodity between any two points 1) Geogrphic: rate basis points and numbers 2) Commodity: commodity classification - class ratings 3) Rate structure: national scale of rates - cwt-based.
100 cars x 100 tons
Amenities/Accommodations - Direct flights to destination without layovers - More personal space in flight - In flight service personnel - No frills types of service (no perks)
A trucking operation that only hauls freight for the firm which owns it

42. What are the highest variable costs in the railroad industry?
A contract for transportation between a shipper and the carrier - also is a cargo receipt
The number of unions and the degree of their involvement in operations and labor management contributes to inefficiencies of the railroads
Declaration of where product was made so that appropriate duties are charged
Labor and Fuel

43. 1 Barge ship is equivalent to how many trucks?
Motor/Truck - around 69-70% - Revenue % for Rail: 5.6%
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
Act as a consolidator and domestic freight forwarder - inbound/outbound container arrangement
58

44. 1 Barge is equivalent to how many tons?
Continuous straight line movement - minimize intermediate handlings - maximize the full capacity of equipment - consolidation and break-bulk activities - empty mileage should be minimized - movement should be scheduled and dispatched.
Substantially higher
1500 tons
83.8%

45. What are the revenues of the specialized and general cargo?
Use of low-sulfur diesel fuel - Use of biodiesel fuel - Cutting down on idling - Reducing traffic congestion
Sysco - Tyson Foods - Coca-Cola - and Walmart
Specialized: $73 Billion - General: $146 Billion
Break bulk - Relay - Pick up - Delivery

46. Micro Bridge
Interior Non-port cities
Move 1 single commodity and are non-stop to destination.
30 - 000 lbs and 300 miles
Completely different continent - different time zones.

47. The current share of railroads in total transportation expenses is closest to...
Coal
NTSB
7%
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.

48. Pricing adjustment conditions
Priority service schedule - often empty backhaul - often cars owned by the shipper - and direct movement from origin to destination
Maximize the utilization of equipment - increase the efficiency of equipment operations - save transit time and operational costs.
Discounts: reduction from published price. Volume: TL vs LTL - Seasonal - Cash 2/10 net 30 - Geographical- FOB origin/destination - Uniform delivered pricing: zone pricing.
Consolidation

49. Near-shoring
Moving to neighboring country - NAFTA - because the places may have close cultural affinity.
Completely different continent - different time zones.
BNSF - CSX Transportation - Kansas City Southern Railway - Grand Truck Corporation - Norfolk Southern - Union Pacific Railroad - Soo Line Railroad
15%~13%

50. Haulage