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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 was the golden age of railroads?
30%
Sysco - Tyson Foods - Coca-Cola - and Walmart
11 hours straight or anything beyond 70 hours in 8 days
1850-1950

2. Which type of railroad cargo has the highest tonnage share in the US?
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
Coal
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
Economies of scale

3. What are the characteristics of a block train?
Priority service schedule - often empty backhaul - often cars owned by the shipper - and direct movement from origin to destination
Switching - Piggybacking - Double-Stacking - Car-Loading - Trackage - Haulage - Drayage - Demurrage
Free on Board- Origin (seller pays shipping costs); Destination (Buyer pays).
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

4. Did the US railroads have anything to do with the creation of world time zones?
Yes
A trucking operation that only hauls freight for the firm which owns it
Coal
40% each to trade partners & 20% to 3rd world country to develop 3rd world ocean shipping industry - it happened to be inefficient.

5. Which economies are most prominent in the trucking industry?
A pumping station
Economies of scope and density
About 2 cents per dollar
Service levels - Frequent flyer programs - Timing of flights - In advance registration

6. How many Class 1 freight railroads are there?
7
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
The closer the operating ratio is to 100 - the more indicative of the possible need to raise rates to increase total revenues
Showed a marked decline

7. What is a typical fixed cost item in the motor carrier industry?
100 tons
Commercial Invoice - Pro-Forma Invoice - Consular Invoice
Terminal
Free on Board- Origin (seller pays shipping costs); Destination (Buyer pays).

8. What is the empirical formula of the typical coal unit train in the US?
100 cars x 100 tons
Main penalty is the cost of lost of sales by holding the shipment.
Coastal/Intercoastal - Great Lakes - Internal
484

9. What is the primary railroad cargo out of Arkansas by tonnage?
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
Carloads and Ton-miles
Crushed stone - gravel and sand
Water (Barge Ships) at 0.72 per ton mile. The second lowest is Rail at 2.24 cents per ton mile.

10. Price variation factors in airline service
1500 tons
Carloads and Ton-miles
Service levels - Frequent flyer programs - Timing of flights - In advance registration
Is likely to stay and even get worse in the future

11. Freight revenue for Modes (per ton-mile)
Slip-Seating - Bob-Tailing - Hub-And-Spoke System - Drop-and-Hook
The competition is intense in both TL and LTL segments
Yes
Air carrier: highest at 80.4% - Truck: 26.6% - Rail:2.24% - Barge Ship: .72% - Oil Pipeline: 1.47%

12. Cost of Service Pricing
A longer combination vehicle towing more than one trailer
Yes
Pricing according to cost incurred to serve - Customer covers all costs - seller sets prices to maximize profits.
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

13. Pooling
Consolidation of shipments to different destinations within the same general area.
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.
Act as a consolidator and domestic freight forwarder - inbound/outbound container arrangement
Large carrying capacity - versatility of cargo - reduced pollution due to higher fuel efficiency compared to trucking - coast-to-coast 'land bridge' with shorter total transit sea+land times for prevailing import container routes

14. On the average - per gallon of fuel - US railroads move a ton of freight...
Yes
484
Terminal
Move 1 single commodity and are non-stop to destination.

15. Value of Service pricing
Declaration of where product was made so that appropriate duties are charged
Amenities/Accommodations - Direct flights to destination without layovers - More personal space in flight - In flight service personnel - No frills types of service (no perks)
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 a second carrier to transport its freight using the second carrier's crew and power equipment

16. Types and shares of cost in railroads
Break bulk - Relay - Pick up - Delivery
Fixed Costs: 30% - Semi-Variable Costs: 40% - Variable Costs: Labor and Gas
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.
About 25 cents per dollar

17. Freight Revenue for Rail (per ton-mile)
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.
About 2 cents per dollar
Not the government - the railroads themselves
The development of the highway system - Limited access points - Long transit times - Safety of cargo during transit

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

19. Invoices
Move 1 single commodity and are non-stop to destination.
Commercial Invoice - Pro-Forma Invoice - Consular Invoice
Consolidation
Market Forces (customers) - Governmental Controls - Other channel member - Competition.

20. Which modes have the following cost structure: Low Variable and High Fixed?
Coal
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
Pipeline and Rail
Far east to east coast or Europe to west coast - final destination is US port city

21. Which government agency will investigate a major railroad accident involving public safety?
250 - 000
NTSB
15
Reduced highway congestion - damage and pollution as a result of replacing trucks as an alternative

22. Commercial Invoice
LTL vs TL - Local vs Intercity Carriers - Publicly owned vs Privately owned - Specialized vs general freight
90-s
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
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

23. 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
Few carriers handle more than 25% of total shipment - service disruptions problems if cease operation.
To save the railroads by giving them a chance to compete with other modes on equal footing
BNSF - CSX Transportation - Kansas City Southern Railway - Grand Truck Corporation - Norfolk Southern - Union Pacific Railroad - Soo Line Railroad

24. What do the users of truck service benefit?
Motor/Truck - around 69-70% - Revenue % for Rail: 5.6%
Covered Hopper
Declaration of where product was made so that appropriate duties are charged
Accessibility - Speed - Universal Connector - Reliability - Frequency - Lower Loss and Damage Rates - Lower Inventory levels due to smaller shipments than other modes

25. What is the difference between class 1 and class 2 carriers?
Federal Railroad Administration (FRA)
Declaration of where product was made so that appropriate duties are charged
(Trucking) Class 1: income > $10M - Class 2: $3M<income<$10M
563

26. Funding the railroads?
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
Moderate
Not the government - the railroads themselves

27. What are the generally accepted classifications of railroads?
The development of the highway system - Limited access points - Long transit times - Safety of cargo during transit
Class 1 - Regional - Shortline - Switching and Terminal
Interior Non-port cities
Coal

28. 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.
83.8%
Increased use of technology - Gradual increase in the number of smaller railroads - Increase in intermodal shipments - Sharp growth in fuel efficiency of locomotives
Break bulk - Relay - Pick up - Delivery

29. What are the types of railcars?
Used for tax - manning - and relaxed regulation.
Boxcar - Hopper Car - Covered Hopper - Flatcar - Gondola - Tank Car
Cash in advance - Letter of Credit - Documentary collection - Open account - TradeCard
Not an invoice but a quote. must be carefully written to avoid discrepancies w/ L of C

30. Who has the highest number of coal carloads?
Federal Railroad Administration (FRA)
About 2 cents per dollar
ton-miles
Wyoming

31. Which phrase best characterizes the level of competition in the motor carrier industry?
7%
The competition is intense in both TL and LTL segments
Labor and Fuel
Consolidation of shipments to different destinations within the same general area.

32. Which economies are present in the US railroad industry?
Economies of scale
Reduced highway congestion - damage and pollution as a result of replacing trucks as an alternative
250 - 000
Is likely to stay and even get worse in the future

33. UNCTAD liner code 40-40-20
Safety regulations - Evaluating fairness of disputed charged rates - Monitoring profitability of railroads - and Mergers and acquisitions
40% each to trade partners & 20% to 3rd world country to develop 3rd world ocean shipping industry - it happened to be inefficient.
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
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

34. 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?
To promote interstate commerce and strengthen the defenses of the country
After World War 2
Water
Transfer of function to another country - can stay within the same company!

35. What are the major causes of general traffic congestions?
Consolidation of shipments to different destinations within the same general area.
Bottlenecks - Traffic accidents - Major snowfalls - Projects to improve existing highways
Maximize the utilization of equipment - increase the efficiency of equipment operations - save transit time and operational costs.
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

36. A barge tow is capable of moving how many barges?
An agreement whereby one railroad pays another for the right to operate its trains over the second carrier's track
FedEx - YRC - Conway - UPS - ABF
15
30%

37. Pro-Forma Invoice
Covered Hopper
Not an invoice but a quote. must be carefully written to avoid discrepancies w/ L of C
A longer combination vehicle towing more than one trailer
A batching pig

38. Social Responsibility pricing
Society and customer first.
Increased use of technology - Gradual increase in the number of smaller railroads - Increase in intermodal shipments - Sharp growth in fuel efficiency of locomotives
7%
58

39. Dock receipt
Maximize the operational time of equipment - fuel efficient speeds - vahicle weight should be minimized - standardized equipment - equipment should be adapted to special market and commodity requirements.
Highway user taxes
Slip-Seating - Bob-Tailing - Hub-And-Spoke System - Drop-and-Hook
Transfers accountability between domestic and international carrier at the terminal

40. How to assess the operating ratio?
40% each to trade partners & 20% to 3rd world country to develop 3rd world ocean shipping industry - it happened to be inefficient.
An agreement whereby one railroad pays a second carrier to transport its freight using the second carrier's crew and power equipment
30 - 000 lbs and 300 miles
The closer the operating ratio is to 100 - the more indicative of the possible need to raise rates to increase total revenues

41. 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)
Not the government - the railroads themselves
Switching - Piggybacking - Double-Stacking - Car-Loading - Trackage - Haulage - Drayage - Demurrage
Commercial Invoice - Pro-Forma Invoice - Consular Invoice

42. It is common for an operating ratio of motor carriers to be around these numbers...
Switching - Piggybacking - Double-Stacking - Car-Loading - Trackage - Haulage - Drayage - Demurrage
Class 1 - Regional - Shortline - Switching and Terminal
90-s
80 - 000 lbs

43. Categories of major pricing decisions
Covering variable costs - volume and equipment utilization - and cash flow.
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.
A trucking operation that only hauls freight for the firm which owns it
484

44. What could be the rationale for railroad mergers?

45. Freight Revenue for Truck/Motor (per ton-mile)
The pickup and delivery of trailers and containers in conjunction with a line-haul rail movement
Cargo can fit in an enclosed van trailer - Food - consumer staples - manufactured goods
About 25 cents per dollar
An agreement whereby one railroad pays a second carrier to transport its freight using the second carrier's crew and power equipment

46. The current share of railroads in total transportation expenses is closest to...
7%
Sysco - Tyson Foods - Coca-Cola - and Walmart
Air carrier: highest at 80.4% - Truck: 26.6% - Rail:2.24% - Barge Ship: .72% - Oil Pipeline: 1.47%
Economies of scale

47. Intermodal Transportation
Bottlenecks - Traffic accidents - Major snowfalls - Projects to improve existing highways
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
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.
Boxcar - Hopper Car - Covered Hopper - Flatcar - Gondola - Tank Car

48. The status of competition within the US railroad industry?
7%
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
Carloads and Ton-miles
Moderate

49. Three kinds of ocean carriers
Break Bulk - Pickup and Delivery - Line Haul - Slip-Seating
Reduced highway congestion - damage and pollution as a result of replacing trucks as an alternative
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.
Fixed Costs: 30% - Semi-Variable Costs: 40% - Variable Costs: Labor and Gas

50. 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?
Is likely to stay and even get worse in the future
Less than 25 carriers handle 75 to 80% of total freight dollar.
Special Rates
A batching pig