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Transportation Logistics

Instructions:

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. Cost of Service Pricing
Pricing according to cost incurred to serve - Customer covers all costs - seller sets prices to maximize profits.
BNSF - CSX Transportation - Kansas City Southern Railway - Grand Truck Corporation - Norfolk Southern - Union Pacific Railroad - Soo Line Railroad
LTL vs TL - Local vs Intercity Carriers - Publicly owned vs Privately owned - Specialized vs general freight
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

2. What is a public benefit of railroads?
Air
Reduced highway congestion - damage and pollution as a result of replacing trucks as an alternative
To promote interstate commerce and strengthen the defenses of the country
Connect buyer and seller- Use of outside firms (outsourcing) to provide own logistics support. Firms: Info-based... freight bill payment - auditing. Asset and operation-based: in/outbound transportation - warehousing...

3. Pro-Forma Invoice
Accessibility - Speed - Universal Connector - Reliability - Frequency - Lower Loss and Damage Rates - Lower Inventory levels due to smaller shipments than other modes
(Trucking) Class 1: income > $10M - Class 2: $3M<income<$10M
Not an invoice but a quote. must be carefully written to avoid discrepancies w/ L of C
83.8%

4. Land Bridge Services
30 - 000 lbs and 300 miles
Intermodal in character
1500 tons
Increased use of technology - Gradual increase in the number of smaller railroads - Increase in intermodal shipments - Sharp growth in fuel efficiency of locomotives

5. Invoices
An agreement whereby one railroad pays another for the right to operate its trains over the second carrier's track
Showed a marked decline
7%
Commercial Invoice - Pro-Forma Invoice - Consular Invoice

6. What are the two primary operational indicators in the railroad industry?
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.
Carloads and Ton-miles
The competition is intense in both TL and LTL segments
BNSF - CSX Transportation - Kansas City Southern Railway - Grand Truck Corporation - Norfolk Southern - Union Pacific Railroad - Soo Line Railroad

7. What is the approximate number of railroads in the US?
To save the railroads by giving them a chance to compete with other modes on equal footing
563
Federal Railroad Administration (FRA)
30 - 000 lbs and 300 miles

8. Carrier's Operational strategies to minimize cost
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.
Consolidation of shipments to different destinations within the same general area.
90-s
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.

9. Which type of a railcar has the highest share in terms of its numbers in service in the US?
Covered Hopper
Act as a consolidator and domestic freight forwarder - inbound/outbound container arrangement
Wyoming
Showed a marked decline

10. What commodity/goods are typically transported by railroads in the US?
Crushed stone - gravel and sand
FedEx - YRC - Conway - UPS - ABF
58
Coal - farm products - chemicals - transportation equipment

11. Consolidation
Main penalty is the cost of lost of sales by holding the shipment.
Declaration of where product was made so that appropriate duties are charged
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
After World War 2

12. What are the current trends in trucking?
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.
Moving a corporations internal activities to outside providers - mainly for cheap labor
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
11 hours straight or anything beyond 70 hours in 8 days

13. Value of Service pricing
The closer the operating ratio is to 100 - the more indicative of the possible need to raise rates to increase total revenues
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
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.
100 cars x 100 tons

14. Factors contributing to the decline of Railroad use
Attests to authenticity and accuracy of the goods. Performs by third party independent company
Bottlenecks - Traffic accidents - Major snowfalls - Projects to improve existing highways
7
The development of the highway system - Limited access points - Long transit times - Safety of cargo during transit

15. What are the issues facing the US railroads?
Main penalty is the cost of lost of sales by holding the shipment.
Not an invoice but a quote. must be carefully written to avoid discrepancies w/ L of C
Alcoholism in the workplace - Challenges of implementing new technology - Need to increase customer service - Challenges of growing intermodal service
Connect buyer and seller- Use of outside firms (outsourcing) to provide own logistics support. Firms: Info-based... freight bill payment - auditing. Asset and operation-based: in/outbound transportation - warehousing...

16. Non-vessel operating common carriers (NVOCC)
Transfer of function to another country - can stay within the same company!
563
Act as a consolidator and domestic freight forwarder - inbound/outbound container arrangement
Accessibility - Speed - Universal Connector - Reliability - Frequency - Lower Loss and Damage Rates - Lower Inventory levels due to smaller shipments than other modes

17. A barge tow is capable of moving how many barges?
A trucking operation that only hauls freight for the firm which owns it
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
15
Maximize the utilization of equipment - increase the efficiency of equipment operations - save transit time and operational costs.

18. _____ mode is ideal for moving electronics - expensive items - flowers - or time sensitive materials such as organs
Break bulk - Container service - LASH service (lighter aboard ship) - RORO service (roll on/off ship).
(Trucking) Class 1: income > $10M - Class 2: $3M<income<$10M
Attests to authenticity and accuracy of the goods. Performs by third party independent company
Air

19. Benefits of hub and spoke system
Maximize the utilization of equipment - increase the efficiency of equipment operations - save transit time and operational costs.
The competition is intense in both TL and LTL segments
Amenities/Accommodations - Direct flights to destination without layovers - More personal space in flight - In flight service personnel - No frills types of service (no perks)
Reduced highway congestion - damage and pollution as a result of replacing trucks as an alternative

20. What were the reasons for the erosion of the railroad dominance in transportation in the US?

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21. What must be used in intervals when transporting pulverized coal mixed with water at long distances?
Odd numbers: North to South highways - increase from west to east - Even numbers: East to West highways - increase from south to north
A pumping station
Accessibility - Speed - Universal Connector - Reliability - Frequency - Lower Loss and Damage Rates - Lower Inventory levels due to smaller shipments than other modes
Consolidation

22. The status of competition within the US railroad industry?
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
About 2 cents per dollar
11 hours straight or anything beyond 70 hours in 8 days
Moderate

23. Dock receipt
Is likely to stay and even get worse in the future
The number of unions and the degree of their involvement in operations and labor management contributes to inefficiencies of the railroads
Transfers accountability between domestic and international carrier at the terminal
Showed a marked decline

24. What term is related to railroad operations?
Declaration of where product was made so that appropriate duties are charged
Highway user taxes
Switching - Piggybacking - Double-Stacking - Car-Loading - Trackage - Haulage - Drayage - Demurrage
Break Bulk - Pickup and Delivery - Line Haul - Slip-Seating

25. What is the difference between TOFC and COFC service?
One method moves the trailer on its wheels while the other moves the container
1850-1950
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
Federal Railroad Administration (FRA)

26. Which economies are present in 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
Main penalty is the cost of lost of sales by holding the shipment.
Economies of scale
Bottlenecks - Traffic accidents - Major snowfalls - Projects to improve existing highways

27. Survival Based pricing
Completely different continent - different time zones.
Covering variable costs - volume and equipment utilization - and cash flow.
Boxcar - Hopper Car - Covered Hopper - Flatcar - Gondola - Tank Car
About 2 cents per dollar

28. Labor relations in the US railroad industry?
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.
NTSB
The number of unions and the degree of their involvement in operations and labor management contributes to inefficiencies of the railroads
Commercial invoice printed on stationery of importing country's consulate and stamped by consulate.

29. Haulage

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30. What was the golden age of railroads?
(Trucking) Class 1: income > $10M - Class 2: $3M<income<$10M
15
Switching - Piggybacking - Double-Stacking - Car-Loading - Trackage - Haulage - Drayage - Demurrage
1850-1950

31. Four types of Liner Service
An agreement whereby one railroad pays a second carrier to transport its freight using the second carrier's crew and power equipment
Commercial invoice printed on stationery of importing country's consulate and stamped by consulate.
After World War 2
Break bulk - Container service - LASH service (lighter aboard ship) - RORO service (roll on/off ship).

32. Drayage
The pickup and delivery of trailers and containers in conjunction with a line-haul rail movement
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
83.8%
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

33. Major commodities hauled by each mode
A batching pig
Far east to east coast or Europe to west coast - final destination is US port city
Motor: HH Goods - Heavy Machinery - Petroleum Products - Dump Trucking - Ag Commodities - Motor Vehicles - Retail Store Delivery
LTL vs TL - Local vs Intercity Carriers - Publicly owned vs Privately owned - Specialized vs general freight

34. Three kinds of ocean carriers
anywhere between a quarter and a third of all highway travel
The development of the highway system - Limited access points - Long transit times - Safety of cargo during transit
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.
Motor/Truck - around 69-70% - Revenue % for Rail: 5.6%

35. What was the rationale behind passing the Staggers Act of 1980?
A contract for transportation between a shipper and the carrier - also is a cargo receipt
To save the railroads by giving them a chance to compete with other modes on equal footing
Discounts: reduction from published price. Volume: TL vs LTL - Seasonal - Cash 2/10 net 30 - Geographical- FOB origin/destination - Uniform delivered pricing: zone pricing.
An agreement whereby one railroad pays another for the right to operate its trains over the second carrier's track

36. Social Responsibility pricing
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.
Moderate
Completely different continent - different time zones.
Society and customer first.

37. Examples of general freight
Federal Railroad Administration (FRA)
Cargo can fit in an enclosed van trailer - Food - consumer staples - manufactured goods
58
Class 1 - Regional - Shortline - Switching and Terminal

38. Which phrase best characterizes the level of competition in the motor carrier industry?
Labor and Fuel
The competition is intense in both TL and LTL segments
ton-miles
About 25 cents per dollar

39. UNCTAD liner code 40-40-20
40% each to trade partners & 20% to 3rd world country to develop 3rd world ocean shipping industry - it happened to be inefficient.
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.
Pipeline and Rail
Market Forces (customers) - Governmental Controls - Other channel member - Competition.

40. What terms describe a type of operation in trucking?
anywhere between a quarter and a third of all highway travel
Slip-Seating - Bob-Tailing - Hub-And-Spoke System - Drop-and-Hook
Consolidation
Alcoholism in the workplace - Challenges of implementing new technology - Need to increase customer service - Challenges of growing intermodal service

41. Starting from which cargo weight and movement distance does it normally make sense to ship by rail?
Market Forces (customers) - Governmental Controls - Other channel member - Competition.
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
30 - 000 lbs and 300 miles
Bottlenecks - Traffic accidents - Major snowfalls - Projects to improve existing highways

42. What could be the rationale for railroad mergers?

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43. How many Class 1 freight railroads are there?
7
Less than 25 carriers handle 75 to 80% of total freight dollar.
Commercial Invoice - Pro-Forma Invoice - Consular Invoice
Motor/Truck - around 69-70% - Revenue % for Rail: 5.6%

44. Service competition areas in airline industry
Amenities/Accommodations - Direct flights to destination without layovers - More personal space in flight - In flight service personnel - No frills types of service (no perks)
Use of low-sulfur diesel fuel - Use of biodiesel fuel - Cutting down on idling - Reducing traffic congestion
100 tons
Odd numbers: North to South highways - increase from west to east - Even numbers: East to West highways - increase from south to north

45. What is the primary railroad cargo out of Arkansas by tonnage?
Crushed stone - gravel and sand
Carloads and Ton-miles
The pickup and delivery of trailers and containers in conjunction with a line-haul rail movement
Interior Non-port cities

46. Government is involved in which aspects of the railroad business?
(Trucking) Class 1: income > $10M - Class 2: $3M<income<$10M
To save the railroads by giving them a chance to compete with other modes on equal footing
Safety regulations - Evaluating fairness of disputed charged rates - Monitoring profitability of railroads - and Mergers and acquisitions
Main penalty is the cost of lost of sales by holding the shipment.

47. Class Rate Calculations
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.
Voyage: Time - Bareboat or demise Voyage: Similar to taxi - ship owner - responsibility for crews & operation Time: Rent Vessel & crew for period of time Bareboat/Demise: Long period - chartering party responsibility for crews & operation
Class 1 - Regional - Shortline - Switching and Terminal
Service levels - Frequent flyer programs - Timing of flights - In advance registration

48. Flags of Convenience
100 cars x 100 tons
Special Rates
Moderate
Used for tax - manning - and relaxed regulation.

49. The current share of railroads in total transportation expenses is closest to...
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
Accessibility - Speed - Universal Connector - Reliability - Frequency - Lower Loss and Damage Rates - Lower Inventory levels due to smaller shipments than other modes
7%
Voyage: Time - Bareboat or demise Voyage: Similar to taxi - ship owner - responsibility for crews & operation Time: Rent Vessel & crew for period of time Bareboat/Demise: Long period - chartering party responsibility for crews & operation

50. Although the Interstate Highway System accounts for about 1% of total public road mileage - it carries...
anywhere between a quarter and a third of all highway travel
250 - 000
Reduced highway congestion - damage and pollution as a result of replacing trucks as an alternative
LTL vs TL - Local vs Intercity Carriers - Publicly owned vs Privately owned - Specialized vs general freight