Deck 13: Physical Distribution

Question 1

Which of the following statements is true?

A) railways are best at moving small volumes of bulky goods over short distances
B) road transport is the least flexible of all the modes
C) air cargo should be used for fast service over short distances
D) all of the above are true
E) none of the above is true.

Answer 1

E

Question 2

The particular way materials move will depend upon:

A) the channels of distribution the firm is using
B) types of markets served
C) characteristics of the product
D) all of the above
E) none of the above.

Answer 2

D

Question 3

Which of the following is true?

A) because of high capital cost, rail must have a large volume of traffic to justify the expense
B) water transport requires low rates of energy per ton mile moved
C) operating costs per ton mile tend to be low for trucks
D) a and b above
E) b and c above.

Answer 3

D

Question 4

Which of the following statements is best?

A) the objective of distribution management is to provide the required level of service at least cost
B) there will be cost trade-off between the various activities in physical distribution
C) distribution can operate separately from marketing and production
D) a and b are true
E) b and c are true.

Question 5

Which of the following types of transportation will provide the best service capability?

A) common
B) contract
C) private
D) all of the above are equal
E) none of the above.

Question 6

Which mode would provide the fastest service capability?

A) air
B) motor
C) rail
D) water.

Question 7

Of the five modes of transportation, which one requires the lowest capital investment?

A) air
B) motor
C) rail
D) water
E) pipeline.

Question 8

Which mode would provide the slowest service capability?

A) air
B) motor
C) rail
D) water.

Question 9

Considering the service desired and the relative cost of the item, which of the following would you most likely ship by truck?

A) regular shipments of cut flowers
B) regular shipments of iron ore
C) regular shipments of grain
D) a and b above
E) b and c above.

Question 10

Which of the following statements is best?

A) physical distribution provides a bridge between marketing and production
B) physical distribution contributes towards creating demand
C) replenishment orders to replace field warehouse stocks will not affect production
D) a and b are true
E) b and c are true.

Question 11

A network of companies that participate in the flow of goods and services from producer to final consumer is a:

A) Supply flow
B) Channel of distribution
C) Transportation channel
D) Logistics supply chain

Question 12

Which of the following statements is FALSE?

A) pipeline capital costs are high in comparison with other modes
B) air cargo is generally used for low value bulky items
C) truck transport is suitable for distribution of small volume goods to a dispersed market
D) water transport is slower than rail
E) rail transport is more suited to bulky low value items than road transport.

Question 13

A shipper moving expensive goods of small size from Boston to Seattle would likely use:

A) air
B) motor
C) rail
D) water
E) none of the above.

Question 14

Which of the following statements is best regarding distribution channels?

A) There are only two members in any distribution channel.
B) The transaction channel is concerned with transfer of ownership.
C) The distribution channel is concerned with the transfer of goods
D) all the above are true
E) b and c only are true.

Question 15

In which case(s) would you use common carriers instead of contract carriers?

A) regular delivery by a food chain to its stores
B) shipment to customers by a mail order house
C) regular shipment of paper from a mill to its warehouse
D) a and b above
E) a and c above.

Question 16

The two criteria for establishing a particular physical distribution system are:

A) cost of the system and service level desired
B) service level and cost of carrying inventory
C) cost of transportation and cost of warehousing
D) cost of transportation and materials handling
E) cost of warehousing and cost of inventory.

Question 17

A contract carrier provides:

A) a service available to the general public
B) a scheduled service
C) published rates
D) all of the above
E) none of the above.

Question 18

Which of the following activities is NOT considered a function of physical distribution?

A) transportation
B) production control
C) distribution inventory
D) warehousing
E) order processing.

Question 19

Which of the following are elements in the cost of carriage?
I) Ways
II) Vehicles
III) Terminals

A) I, II and III
B) I and II
C) I and III
D) II and III.

Question 20

In which case(s) would you use contract carriers instead of common carriers?

A) regular delivery by a food chain to its stores
B) shipment to customers by a mail order house
C) regular shipment of paper from a mill to its warehouse
D) a and b above
E) a and c above.

Question 21

Which of the following is a basic role of packaging in distribution?
I) Identify the product.
II) Contain and protect the product.
III) Contribute to physical distribution efficiency.
IV) Be an important part of the marketing program.

A) all the above
B) I, II and III only
C) I, II and IV only
D) II, III and IV only
E) none of the above.

Question 22

Which of the following statements is true regarding goods in a reverse logistics system?

A) Volumes are equal to the forward logistics system.
B) They travel through the same terminals as the forward logistics system.
C) The goods tend to be small in quantity.
D) Little product information is required.
E) All of the above are true.

Question 23

Which mode of transportation would cost the LEAST per ton mile?

A) air
B) motor (truck)
C) rail
D) water.

Question 24

Which management area does NOT normally have transportation responsibility?

A) Logistics
B) Purchasing
C) All of the above normally have responsibility for transportation.
C) Manufacturing
D) Marketing

Question 25

A shipper wishing to reduce transportation costs will:

A) ship only in small quantities
B) ship to LTL lots
C) use trucks for all his shipments
D) all of the above
E) none of the above.

Question 26

A service provider that provide product warehouse and delivery services is known as:

A) Third party logistics provider
B) Freight broker
C) Freight forwarder
D) Distribution partner

Question 27

The market boundary is:

A) a location beyond which a source cannot supply
B) the line between two or more supply sources where the landed cost is the same
C) an agreed-upon boundary beyond which competition will not sell
D) the extent of a market area
E) a legal limitation placed on the delivery of goods.

Question 28

Which of the following statements is best?

A) material handling costs will start to rise when nonunitized loads are shipped
B) inventory costs remain constant as the number of warehouses increase
C) packaging costs increase as the number of warehouses increase
D) a and b are true
E) a and c are true.

Question 29

TOTAL line haul costs will vary directly with:

A) the distance moved
B) the weight moved
C) the density of the goods
D) a and b above
E) b and c above.

Question 30

Which of the following is correct?

A) consolidating shipments reduces billing and collecting costs
B) line haul cost per hundredweight can be reduced by increasing the weight shipped
C) shipping costs will be higher with common carriers than contract carriers
D) all of the above
E) none of the above.

Question 31

The rate charged by a carrier will vary with: I. The value of the goods.
II) The density of the goods.
III) The color of the goods.

A) all the above
B) I and II only
C) I and III only
D) II and III only
E) I only.

Question 32

Which of the following are elements in transportation cost?

A) line haul
B) pickup and delivery
C) terminal handling
D) all of the above
E) none of the above.

Question 33

Which of the following statements is best regarding material handling in distribution systems?
I) One objective of material handling is to increase cube utilization.
II) Material handling can increase the service level.
III) Gasoline powered industrial trucks are used indoors.

A) all the above are true
B) I and II are true
C) I and III are true
D) II and III are true
E) I only is true.

Question 34

The terms which specify who owns and pays for the cost of the transportation are:

A) Freight on board (FOB) terms
B) Incoterms
C) Both a and b
D) Neither a or b

Question 35

To decrease shipping costs a shipper will: I. Increase the weight shipped.
II) Consolidate shipments.
III) Use a common carrier rather than contract carrier.

A) all the above
B) I and II only
C) I and III only
D) II and III only
E) I only.

Question 36

As more warehouses are added to a physical distribution system we can expect the cost of:

A) TL and CL shipments to increase
B) LCL and LTL shipments to decrease
C) total transportation costs to decrease
D) all of the above
E) a and b above.

Question 37

The consolidation of several units into larger units for fewer handlings is called:

A) unitization
B) consolidation
C) cube utilization
D) packaging
E) materials handling.

Question 38

Which of the following is NOT an important role of distribution centers?

A) transportation consolidation
B) in-transit inventory
C) product mixing
D) break-bulk storage
E) customer service.

Question 39

Consolidating shipments will reduce which of the following costs?

A) pickup and delivery
B) terminal handling
C) billing and collecting
D) all of the above
E) none of the above.

Question 40

The term used for placing the responsibility on the supplier to dispose of packaging or restricted materials is called

A) Sustainability
B) Green reverse logistics
C) Fourth party logistics
D) Vendor-managed inventory

Question 41

The LTL costs a product moving through a supply chain are $1 per mile and there is a warehouse 200 miles from Central supply. Truckload costs to the ware house are $50 and the warehouse handling and storage costs are $10. The cost to ship the product to the warehouse $50. The market boundary for this supply chain is:

A) 260 miles
B) 130 miles
C) 125 miles
D) 100 miles
E) 50 miles

Question 42

Which of the following costs is NOT included in the total laid down cost of a product shipped through a regional warehouse?

A) Product cost.
B) Warehouse cost.
C) TL to warehouse
D) Warehousing cost.
E) Market boundary cost.