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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. Skimming pricing
Declaration of where product was made so that appropriate duties are charged
The number of unions and the degree of their involvement in operations and labor management contributes to inefficiencies of the railroads
High price for price insensitive customers.
After World War 2

2. Certificate of Inspection
Water
40% each to trade partners & 20% to 3rd world country to develop 3rd world ocean shipping industry - it happened to be inefficient.
90-s
Attests to authenticity and accuracy of the goods. Performs by third party independent company

3. Labor relations in the US railroad industry?
Few carriers handle more than 25% of total shipment - service disruptions problems if cease operation.
The number of unions and the degree of their involvement in operations and labor management contributes to inefficiencies of the railroads
90-s
Declaration of where product was made so that appropriate duties are charged

4. 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.
Special Rates
Economies of scale
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

5. The average annual salary of a locomotive operator compared to a TL driver in the US is...
100 cars x 100 tons
Covered Hopper
563
Substantially higher

6. UNCTAD liner code 40-40-20
Terminal
40% each to trade partners & 20% to 3rd world country to develop 3rd world ocean shipping industry - it happened to be inefficient.
80 - 000 lbs
Amenities/Accommodations - Direct flights to destination without layovers - More personal space in flight - In flight service personnel - No frills types of service (no perks)

7. Haulage

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8. Benefits of hub and spoke system
Maximize the utilization of equipment - increase the efficiency of equipment operations - save transit time and operational costs.
Boxcar - Hopper Car - Covered Hopper - Flatcar - Gondola - Tank Car
80 - 000 lbs
83.8%

9. The current share of railroads in total transportation expenses is closest to...
1500 tons
An agreement whereby one railroad pays another for the right to operate its trains over the second carrier's track
Motor/Truck - around 69-70% - Revenue % for Rail: 5.6%
7%

10. What are the LTL carriers?
40% each to trade partners & 20% to 3rd world country to develop 3rd world ocean shipping industry - it happened to be inefficient.
Bottlenecks - Traffic accidents - Major snowfalls - Projects to improve existing highways
Air
FedEx - YRC - Conway - UPS - ABF

11. Trackage

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12. Intermodal Transportation
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.
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.
Odd numbers: North to South highways - increase from west to east - Even numbers: East to West highways - increase from south to north
Main penalty is the cost of lost of sales by holding the shipment.

13. What is the difference between class 1 and class 2 carriers?
Slip-Seating - Bob-Tailing - Hub-And-Spoke System - Drop-and-Hook
Carloads and Ton-miles
(Trucking) Class 1: income > $10M - Class 2: $3M<income<$10M
Water (Barge Ships) at 0.72 per ton mile. The second lowest is Rail at 2.24 cents per ton mile.

14. What are the two primary operational indicators in the railroad industry?
Carloads and Ton-miles
Declaration of where product was made so that appropriate duties are charged
Discounts: reduction from published price. Volume: TL vs LTL - Seasonal - Cash 2/10 net 30 - Geographical- FOB origin/destination - Uniform delivered pricing: zone pricing.
Break bulk - Relay - Pick up - Delivery

15. What is the rationale behind passing a federal act in 1956 to create a national system of interstate highways?
7
Free on Board- Origin (seller pays shipping costs); Destination (Buyer pays).
To promote interstate commerce and strengthen the defenses of the country
Coal - farm products - chemicals - transportation equipment

16. Consolidation
Motor/Truck - around 69-70% - Revenue % for Rail: 5.6%
Main penalty is the cost of lost of sales by holding the shipment.
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
(Trucking) Class 1: income > $10M - Class 2: $3M<income<$10M

17. Carrier's Operational strategies to minimize cost
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
11 hours straight or anything beyond 70 hours in 8 days
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.
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...

18. Social Responsibility pricing
After World War 2
Maximize the utilization of equipment - increase the efficiency of equipment operations - save transit time and operational costs.
Society and customer first.
90-s

19. What aspects of the trucking industry is the US involved in?
Use of low-sulfur diesel fuel - Use of biodiesel fuel - Cutting down on idling - Reducing traffic congestion
After World War 2
Truck safety requirements - Driver hours of service - User fee charges - Reduction of pollution from trucks
Wyoming

20. Near-shoring
Moving to neighboring country - NAFTA - because the places may have close cultural affinity.
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
7%
Switching - Piggybacking - Double-Stacking - Car-Loading - Trackage - Haulage - Drayage - Demurrage

21. How are interstate highways numbered?
Break bulk - Relay - Pick up - Delivery
Discounts: reduction from published price. Volume: TL vs LTL - Seasonal - Cash 2/10 net 30 - Geographical- FOB origin/destination - Uniform delivered pricing: zone pricing.
Odd numbers: North to South highways - increase from west to east - Even numbers: East to West highways - increase from south to north
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.

22. What must be used in intervals when transporting pulverized coal mixed with water at long distances?
Moving a corporations internal activities to outside providers - mainly for cheap labor
A pumping station
58
The pickup and delivery of trailers and containers in conjunction with a line-haul rail movement

23. What are the revenues of the specialized and general cargo?
Specialized: $73 Billion - General: $146 Billion
Terminal
The number of unions and the degree of their involvement in operations and labor management contributes to inefficiencies of the railroads
An agreement whereby one railroad pays another for the right to operate its trains over the second carrier's track

24. What was the golden age of railroads?
Declaration of where product was made so that appropriate duties are charged
1850-1950
Water
58

25. Where does funding for the roads come from?
Not the government - the railroads themselves
83.8%
Highway user taxes
Odd numbers: North to South highways - increase from west to east - Even numbers: East to West highways - increase from south to north

26. Unit trains
1500 tons
7%
Move 1 single commodity and are non-stop to destination.
Transfer of function to another country - can stay within the same company!

27. Which economies are most prominent in the trucking industry?
High price for price insensitive customers.
Economies of scope and density
Commercial Invoice - Pro-Forma Invoice - Consular Invoice
Labor and Fuel

28. 1 Barge is equivalent to how many tons?
1500 tons
484
Odd numbers: North to South highways - increase from west to east - Even numbers: East to West highways - increase from south to north
Yes

29. Dock receipt
Wyoming
Commercial invoice printed on stationery of importing country's consulate and stamped by consulate.
Consolidation of shipments to different destinations within the same general area.
Transfers accountability between domestic and international carrier at the terminal

30. What is a typical fixed cost item in the motor carrier industry?
Terminal
Pipeline and Rail
Highway user taxes
Not an invoice but a quote. must be carefully written to avoid discrepancies w/ L of C

31. How many Class 1 freight railroads are there?
Break bulk - Container service - LASH service (lighter aboard ship) - RORO service (roll on/off ship).
80 - 000 lbs
7
The pickup and delivery of trailers and containers in conjunction with a line-haul rail movement

32. Terms of Payment
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
Cash in advance - Letter of Credit - Documentary collection - Open account - TradeCard
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.
FedEx - YRC - Conway - UPS - ABF

33. Pooling
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.
The intermodal competition has increased dramatically since WW 2
Free on Board- Origin (seller pays shipping costs); Destination (Buyer pays).
Consolidation of shipments to different destinations within the same general area.

34. Did the US railroads have anything to do with the creation of world time zones?
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.
Yes
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
To save the railroads by giving them a chance to compete with other modes on equal footing

35. The whole history of the US railroads is a history of...
BNSF - CSX Transportation - Kansas City Southern Railway - Grand Truck Corporation - Norfolk Southern - Union Pacific Railroad - Soo Line Railroad
Consolidation
Bottlenecks - Traffic accidents - Major snowfalls - Projects to improve existing highways
Intermodal in character

36. Land Bridge
563
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
anywhere between a quarter and a third of all highway travel
Federal Railroad Administration (FRA)

37. What factors lead to reduction of air pollution by trucks?
Free on Board- Origin (seller pays shipping costs); Destination (Buyer pays).
Moving a corporations internal activities to outside providers - mainly for cheap labor
Substantially higher
Use of low-sulfur diesel fuel - Use of biodiesel fuel - Cutting down on idling - Reducing traffic congestion

38. Types of vehicles for trucking
Federal Railroad Administration (FRA)
Far east to east coast or Europe to west coast - final destination is US port city
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
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

39. Which phrase best characterizes the level of competition in the motor carrier industry?
80 - 000 lbs
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
100 cars x 100 tons
The competition is intense in both TL and LTL segments

40. LTL terminals are used for connections with these operations...
Commercial Invoice - Pro-Forma Invoice - Consular Invoice
Few carriers handle more than 25% of total shipment - service disruptions problems if cease operation.
Break Bulk - Pickup and Delivery - Line Haul - Slip-Seating
Labor and Fuel

41. What are the current trends in trucking?
Economies of scope and density
Completely different continent - different time zones.
Service levels - Frequent flyer programs - Timing of flights - In advance registration
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

42. Who has the highest number of coal carloads?
Consolidation of shipments to different destinations within the same general area.
Wyoming
About 2 cents per dollar
Coal

43. Four types of Liner Service
Highway user taxes
A pumping station
Break bulk - Container service - LASH service (lighter aboard ship) - RORO service (roll on/off ship).
Cash in advance - Letter of Credit - Documentary collection - Open account - TradeCard

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

45. Survival Based pricing
Sysco - Tyson Foods - Coca-Cola - and Walmart
Accessibility - Speed - Universal Connector - Reliability - Frequency - Lower Loss and Damage Rates - Lower Inventory levels due to smaller shipments than other modes
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.
Covering variable costs - volume and equipment utilization - and cash flow.

46. Factors contributing to the decline of Railroad use
The development of the highway system - Limited access points - Long transit times - Safety of cargo during transit
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
Odd numbers: North to South highways - increase from west to east - Even numbers: East to West highways - increase from south to north

47. Value of Service pricing
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.
Consolidation
Yes
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

48. Freight Revenue for Rail (per ton-mile)
About 2 cents per dollar
Far east to east coast or Europe to west coast - final destination is US port city
250 - 000
About 25 cents per dollar

49. Which economies are present in the US railroad industry?
Water
Economies of scale
Free on Board- Origin (seller pays shipping costs); Destination (Buyer pays).
To promote interstate commerce and strengthen the defenses of the country

50. What is Amtrak?
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
Carloads and Ton-miles
Class 1 - Regional - Shortline - Switching and Terminal
15%~13%