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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. Ways to classify the motor carriers
LTL vs TL - Local vs Intercity Carriers - Publicly owned vs Privately owned - Specialized vs general freight
Highway user taxes
The number of unions and the degree of their involvement in operations and labor management contributes to inefficiencies of the railroads
Less than 25 carriers handle 75 to 80% of total freight dollar.

2. What was the rationale behind passing the Staggers Act of 1980?
A pumping station
To save the railroads by giving them a chance to compete with other modes on equal footing
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.
Discounts: reduction from published price. Volume: TL vs LTL - Seasonal - Cash 2/10 net 30 - Geographical- FOB origin/destination - Uniform delivered pricing: zone pricing.

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

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4. Categories of major pricing decisions
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.
A batching pig
Moving a corporations internal activities to outside providers - mainly for cheap labor
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.

5. Factors contributing to the decline of Railroad use
Increased use of technology - Gradual increase in the number of smaller railroads - Increase in intermodal shipments - Sharp growth in fuel efficiency of locomotives
The development of the highway system - Limited access points - Long transit times - Safety of cargo during transit
Switching - Piggybacking - Double-Stacking - Car-Loading - Trackage - Haulage - Drayage - Demurrage
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...

6. Intermodal Transportation
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
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.
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...
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

7. Which modes have the following cost structure: Low Variable and High Fixed?
Pipeline and Rail
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
Not an invoice but a quote. must be carefully written to avoid discrepancies w/ L of C
58

8. Near-shoring
Moving to neighboring country - NAFTA - because the places may have close cultural affinity.
Commercial Invoice - Pro-Forma Invoice - Consular Invoice
Break bulk - Relay - Pick up - Delivery
Truck safety requirements - Driver hours of service - User fee charges - Reduction of pollution from trucks

9. 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
Consolidation of shipments to different destinations within the same general area.
Commercial invoice printed on stationery of importing country's consulate and stamped by consulate.
Coal

10. How does the US railroad industry compete with other modes?
The intermodal competition has increased dramatically since WW 2
15%~13%
1500 tons
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

11. Name the types of trucking terminals
Priority service schedule - often empty backhaul - often cars owned by the shipper - and direct movement from origin to destination
Break bulk - Relay - Pick up - Delivery
Intermodal in character
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.

12. Non-vessel operating common carriers (NVOCC)
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.
Act as a consolidator and domestic freight forwarder - inbound/outbound container arrangement
Increased use of technology - Gradual increase in the number of smaller railroads - Increase in intermodal shipments - Sharp growth in fuel efficiency of locomotives
83.8%

13. Main forms of Charter Ships
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.
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
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
Motor/Truck - around 69-70% - Revenue % for Rail: 5.6%

14. 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?
Water
30%
A batching pig
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.

15. Third Party Logistics
Alcoholism in the workplace - Challenges of implementing new technology - Need to increase customer service - Challenges of growing intermodal service
Accessibility - Speed - Universal Connector - Reliability - Frequency - Lower Loss and Damage Rates - Lower Inventory levels due to smaller shipments than other modes
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...
Odd numbers: North to South highways - increase from west to east - Even numbers: East to West highways - increase from south to north

16. Haulage

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17. Pro-Forma Invoice
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
Free on Board- Origin (seller pays shipping costs); Destination (Buyer pays).
NTSB
Not an invoice but a quote. must be carefully written to avoid discrepancies w/ L of C

18. Trackage

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19. What are the major causes of general traffic congestions?
Cargo can fit in an enclosed van trailer - Food - consumer staples - manufactured goods
Amenities/Accommodations - Direct flights to destination without layovers - More personal space in flight - In flight service personnel - No frills types of service (no perks)
Bottlenecks - Traffic accidents - Major snowfalls - Projects to improve existing highways
Air

20. Funding the railroads?
A longer combination vehicle towing more than one trailer
Sysco - Tyson Foods - Coca-Cola - and Walmart
Service levels - Frequent flyer programs - Timing of flights - In advance registration
Not the government - the railroads themselves

21. Land Bridge
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
A trucking operation that only hauls freight for the firm which owns it
Not the government - the railroads themselves
Moving a corporations internal activities to outside providers - mainly for cheap labor

22. The current share of railroads in total transportation expenses is closest to...
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.
7%
Consolidate orders for several customers and stop along the way for partial unloading.
The development of the highway system - Limited access points - Long transit times - Safety of cargo during transit

23. What commodity/goods are typically transported by railroads in the US?
Coal - farm products - chemicals - transportation equipment
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
Switching - Piggybacking - Double-Stacking - Car-Loading - Trackage - Haulage - Drayage - Demurrage
Market Forces (customers) - Governmental Controls - Other channel member - Competition.

24. Freight revenue for Modes (per ton-mile)
Priority service schedule - often empty backhaul - often cars owned by the shipper - and direct movement from origin to destination
Cash in advance - Letter of Credit - Documentary collection - Open account - TradeCard
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
Air carrier: highest at 80.4% - Truck: 26.6% - Rail:2.24% - Barge Ship: .72% - Oil Pipeline: 1.47%

25. What are the current trends in the US railroad?
Increased use of technology - Gradual increase in the number of smaller railroads - Increase in intermodal shipments - Sharp growth in fuel efficiency of locomotives
Economies of scope and density
Motor: HH Goods - Heavy Machinery - Petroleum Products - Dump Trucking - Ag Commodities - Motor Vehicles - Retail Store Delivery
Yes

26. What could be the rationale for railroad mergers?

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27. 1 Barge is equivalent to how many tons?
Carloads and Ton-miles
7%
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
1500 tons

28. Micro Bridge
Slip-Seating - Bob-Tailing - Hub-And-Spoke System - Drop-and-Hook
Interior Non-port cities
Far east to east coast or Europe to west coast - final destination is US port city
To save the railroads by giving them a chance to compete with other modes on equal footing

29. What are the two primary operational indicators in the railroad industry?
Carloads and Ton-miles
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.
Consolidation
Less than 25 carriers handle 75 to 80% of total freight dollar.

30. Pooling
One method moves the trailer on its wheels while the other moves the container
Not the government - the railroads themselves
Consolidation of shipments to different destinations within the same general area.
To save the railroads by giving them a chance to compete with other modes on equal footing

31. The whole history of the US railroads is a history of...
Consolidation
Declaration of where product was made so that appropriate duties are charged
ton-miles
Less than 25 carriers handle 75 to 80% of total freight dollar.

32. What are the LTL carriers?
Free on Board- Origin (seller pays shipping costs); Destination (Buyer pays).
To save the railroads by giving them a chance to compete with other modes on equal footing
FedEx - YRC - Conway - UPS - ABF
Switching - Piggybacking - Double-Stacking - Car-Loading - Trackage - Haulage - Drayage - Demurrage

33. Types of vehicles for trucking
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
Few carriers handle more than 25% of total shipment - service disruptions problems if cease operation.
The development of the highway system - Limited access points - Long transit times - Safety of cargo during transit
1850-1950

34. Name the 3 types of water carriers
The closer the operating ratio is to 100 - the more indicative of the possible need to raise rates to increase total revenues
Coastal/Intercoastal - Great Lakes - Internal
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
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.

35. 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.
Crushed stone - gravel and sand
90-s
Increased use of technology - Gradual increase in the number of smaller railroads - Increase in intermodal shipments - Sharp growth in fuel efficiency of locomotives
Special Rates

36. 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
Water
High price for price insensitive customers.
Act as a consolidator and domestic freight forwarder - inbound/outbound container arrangement

37. What is the rationale behind passing a federal act in 1956 to create a national system of interstate highways?
To promote interstate commerce and strengthen the defenses of the country
100 tons
Less than 25 carriers handle 75 to 80% of total freight dollar.
NTSB

38. Names of the Class 1 railroads?
Wyoming
Pipeline and Rail
BNSF - CSX Transportation - Kansas City Southern Railway - Grand Truck Corporation - Norfolk Southern - Union Pacific Railroad - Soo Line Railroad
Substantially higher

39. What are the types of railcars?
Move 1 single commodity and are non-stop to destination.
15%~13%
Boxcar - Hopper Car - Covered Hopper - Flatcar - Gondola - Tank Car
40% each to trade partners & 20% to 3rd world country to develop 3rd world ocean shipping industry - it happened to be inefficient.

40. Certificate of origin
Water
Reduced highway congestion - damage and pollution as a result of replacing trucks as an alternative
Declaration of where product was made so that appropriate duties are charged
250 - 000

41. A barge tow is capable of moving how many barges?
The development of the highway system - Limited access points - Long transit times - Safety of cargo during transit
Showed a marked decline
The intermodal competition has increased dramatically since WW 2
15

42. Benefits of hub and spoke system
Not the government - the railroads themselves
A trucking operation that only hauls freight for the firm which owns it
About 2 cents per dollar
Maximize the utilization of equipment - increase the efficiency of equipment operations - save transit time and operational costs.

43. Land Bridge Services
BNSF - CSX Transportation - Kansas City Southern Railway - Grand Truck Corporation - Norfolk Southern - Union Pacific Railroad - Soo Line Railroad
Intermodal in character
About 25 cents per dollar
Slip-Seating - Bob-Tailing - Hub-And-Spoke System - Drop-and-Hook

44. What factors lead to reduction of air pollution by trucks?
11 hours straight or anything beyond 70 hours in 8 days
Use of low-sulfur diesel fuel - Use of biodiesel fuel - Cutting down on idling - Reducing traffic congestion
Transfers accountability between domestic and international carrier at the terminal
Commercial invoice printed on stationery of importing country's consulate and stamped by consulate.

45. Survival Based pricing
90-s
Amenities/Accommodations - Direct flights to destination without layovers - More personal space in flight - In flight service personnel - No frills types of service (no perks)
Economies of scope and density
Covering variable costs - volume and equipment utilization - and cash flow.

46. LTL terminals are used for connections with these operations...
Far east to east coast or Europe to west coast - final destination is US port city
Break Bulk - Pickup and Delivery - Line Haul - Slip-Seating
An agreement whereby one railroad pays another for the right to operate its trains over the second carrier's track
Highway user taxes

47. How many Class 1 freight railroads are there?
7
15%~13%
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

48. Unit trains
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.
Bottlenecks - Traffic accidents - Major snowfalls - Projects to improve existing highways
Cash in advance - Letter of Credit - Documentary collection - Open account - TradeCard
Move 1 single commodity and are non-stop to destination.

49. Mistakes in pricing strategy
250 - 000
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.
A batching pig
Class 1 - Regional - Shortline - Switching and Terminal

50. The status of competition within the US railroad industry?
To save the railroads by giving them a chance to compete with other modes on equal footing
Accessibility - Speed - Universal Connector - Reliability - Frequency - Lower Loss and Damage Rates - Lower Inventory levels due to smaller shipments than other modes
Consolidation of shipments to different destinations within the same general area.
Moderate