Deck 13: Transportation Management

Question 1

Liability for loss and damage is one factor used to determine a product's freight classification. Which of the following is not a loss and damage consideration?
a. a commodity's propensity to damage other freight
b. ability to load freight on top of a commodity
c. a commodity's perishability
d. a commodity's value
e. all of the above are loss and damage considerations

Answer 1

ability to load freight on top of a commodity

Question 2

____ refers to the buying and controlling of transportation services by either a shipper or consignee.
a. transportation management
b. logistics management
c. routing
d. tracking

Answer 2

transportation management

Question 3

A(n) ____ refers to a transportation manager who purchases a prespecified level of transportation service and is indifferent to the mode and carrier used to provide the transportation service.
a. industrial transportation manager
b. certified logistics professional
c. third-party logistics shipper
d. amodal shipper

Answer 3

amodal shipper

Question 4

____ signifies the price charged for freight transportation.
a. fare
b. tariff
c. rate
d. revenue

Question 5

Which of the following is not one of the three primary factors that transportation rates are based upon?
a. product
b. density
c. weight
d. distance

Question 6

Which of the following tends to be the most important factor in carrier selection?
a. pricing
b. loss and damage performance
c. transit time reliability
d. financial stability
e. none of the above

Question 7

The National Motor Freight Classification currently has 18 separate ratings, or classes, that range for Class 50 to Class ____
a. 300
b. 400
c. 500
d. 600
e. none of the above

Question 8

The most important single transportation document is the ____.
a. freight bill
b. bill of lading
c. commercial invoice
d. certificate of origin

Question 9

With FOB destination, freight prepaid ____.
a. the buyer pays the freight charges, but the seller owns the goods in transit
b. the buyer pays the freight charges and owns the goods in transit
c. the seller pays the freight charges and owns the goods in transit
d. the seller pays the freight charges, but the buyer owns the goods in transit

Question 10

In the class rate system, freight rates are expressed in dollars or cents per ____.
a. hundredweight
b. pounds
c. kilograms
d. tons

Question 11

Weight times rate equals ____.
a. density
b. transportation cost
c. stowability
d. volume
e. none of the above

Question 12

With respect to a commodity's freight classification, shippers tend to prefer a ____ classification number and carriers tend to prefer a ____ classification number.
a. lower, lower
b. lower, higher
c. higher, lower
d. higher, higher

Question 13

Which of the following is not a possible payment option (terms of sale) for U.S. domestic shipments?
a. FOB origin, freight collect and charged back
b. FOB origin, freight collect
c. FOB origin, freight prepaid
d. FOB origin, freight prepaid and charged back
e. all of the above are possible payment options

Question 14

In general terms, ____ accounts for about 6% of U.S. gross domestic product.
a. warehousing
b. logistics
c. supply chain management
d. transportation

Question 15

____ refers to how heavy a product is in relation to its size.
a. stowability
b. volume
c. weight
d. density

Question 16

Which of the following is not a factor used to determine a product's classification?
a. density
b. liability to damage and theft
c. stowability
d. ease of handling
e. all of the above are factors used to determine a product's classification

Question 17

____ refers to how easy a commodity is to pack into a load.
a. recoupering
b. stowability
c. drayage
d. materials handling

Question 18

A(n) ____ rate refers to a specific rate for every possible combination of product, weight, and distance.
a. exception
b. ad valorem
c. commodity
d. class

Question 19

A(n) ____ rate simplifies each of the three primary rate factors-product, weight, and distance.
a. class
b. ad valorem
c. exception
d. commodity

Question 20

Suppose that a particular item is Class 200 according to the National Motor Freight Classification. What is the relationship between this item's rate and the rate for an item in Class 100?
a. the class 200 rate is lower than the class 100 rate
b. the rate relationship depends on other factors
c. the rates are identical
d. the class 200 rate is higher than the class 100 rate
e. there is insufficient information to answer the question

Question 21

Demurrage charges are collected by railroads, ____, and ____.
a. motor carriers, pipelines
b. water carriers, pipelines
c. motor carriers, water carriers
d. airlines, pipelines

Question 22

U.S. freight railroads currently allow ____ hours of free time for unloading railcars and ____hours of free time for loading railcars.
a. 24, 24
b. 24, 48
c. 48, 24
d. 48, 48

Question 23

An order bill of lading is used ____.
a. for overseas shipments
b. when a shipment must be expedited
c. when a shipment is started before the buyer is known
d. to guard against disruptions in transit

Question 24

Today's transportation manager can play an active role in blending the appropriate pricing and service packages for his / her organization.

Question 25

A ____ provides a variety of shipment information such as shipment preparation, freight invoicing, a list of preferred carriers, and a list of which carrier or carriers to use for shipments moving between two points.
a. freight book
b. routing guide
c. tariff
d. bill of lading

Question 26

____ refers to determining a shipment's location during the course of its move.
a. expediting
b. recoupering
c. reparation
d. tracking

Question 27

Which of the following is false?
a. freight claims must be filed within nine months of the delivery date
b. concealed loss and damage is a delicate area for shippers and carriers
c. the volume of freight claims activity has dropped since transportation deregulation
d. shippers or carriers are entitled to a product's full retail value when filing a freight claim
e. all of the above are true

Question 28

What is the time limitation within which a freight claim must be filed?
a. three months from delivery date
b. six months from delivery date
c. nine months from delivery date
d. twelve months from delivery date
e. none of the above

Question 29

If a product destroyed or damaged in transit is intended to be placed into general replacement inventory, then the retailer would likely receive ____.
a. nothing but an apology from the carrier
b. the wholesale price, plus 20%
c. the retail price, minus 20%
d. the wholesale price, plus freight if previously paid

Question 30

Each of the following is true, except ____.
a. the bill of lading is the most important transportation document
b. the bill of lading adds to the complexity of the transportation manager's job
c. the straight bill of lading contains the name of the consignee
d. the order bill of lading does not contain the name of the consignee
e. all of the above are true

Question 31

Freight transportation accounts for approximately 10% of U.S. gross domestic product.

Question 32

Routing refers to the buying and controlling of transportation services by a shipper or consignee.

Question 33

____ can be defined as the process of determining how a shipment will be moved between origin and destination.
a. tracking
b. recoupering
c. transportation
d. routing

Question 34

Which of the following statements is false?
a. carriers may be reluctant to accept small shipments because they require a high degree of manual labor
b. some carriers believe they lose money on small shipments
c. consolidating small shipments into larger ones could result in poorer service to the final customer
d. consolidating small shipments into larger ones likely results in higher inventory carrying costs
e. all of the above are true

Question 35

Which of the following statements is false?
a. detention is similar to demurrage, except that detention applies to pipelines
b. demurrage is a penalty payment made to a railroad for keeping equipment beyond the time it should be released
c. averaging agreements can be used with demurrage
d. carriers and shippers can negotiate demurrage / detention policies
e. all of the above are true

Question 36

A rate is the logistics term that signifies the price charged for freight transportation.

Question 37

An invoice submitted by the carrier requesting to be paid is ____.
a. a freight bill
b. a bill of lading
c. a carnet
d. dunnage

Question 38

____ refers to rapidly moving a shipment through a carrier's system.
a. expediting
b. recoupering
c. fast logistics
d. cross-docking

Question 39

Small shipments are defined as those that ____.
a. involve three or fewer cartons
b. are moved primarily by parcel carriers
c. weigh more than 150 pounds but less than 500 pounds
d. weigh more than 10 pounds but less than 100 pounds

Question 40

A transportation charge (the cost of transportation) can be calculated by multiplying a product's weight times the applicable rate.

Question 41

The class rate system simplifies with respect to three primary factors-density, product, and distance.

Question 42

Liability to damage and theft is viewed as the primary factor in setting a product's freight classification.

Question 43

Ease of handling is one of the four factors used to determine a product's freight classification.

Question 44

Stowability refers to how easy a commodity is to pack into a load.

Question 45

The carrier selection procedure appears to be less straightforward than the procedure for modal selection.

Question 46

Because transportation costs tend to be lower per unit of weight for larger shipments, there is a natural motivation to consolidate smaller shipments into larger ones.

Question 47

With FOB origin pricing, the seller retains title and control of the shipment until it is delivered.

Question 48

An order bill of lading specifies the consignee.

Question 49

The price and service trade-offs available to today's transportation manager are limited only by her / his creativity and ingenuity.

Question 50

An amodal shipper refers to the use of a logistics intermediary to make the relevant transportation decisions.

Question 51

A disadvantage of FOB destination pricing from a seller's perspective is that the seller's organization must have a thorough knowledge of transportation management.

Question 52

Transit time reliability is the most important factor that shippers tend to use when selecting carriers.

Question 53

The most important single transportation document is the bill of lading.

Question 54

Transportation documentation serves both a practical function (e.g., what, where, and how much is being transported) as well as potentially providing legal recourse if something goes awry.

Question 55

A commodity rate is very good for dealing with demand-specific situations.

Question 56

The National Motor Freight Classification has 18 separate classes, or ratings, from Class 50 to Class 600.

Question 57

An item with a freight classification of Class 200 will be charged a higher rate than an item with a freight classification of Class 100.

Question 58

Order bills of lading can be used when faced with slow-paying customers.

Question 59

With respect to a commodity's freight classification, shippers tend to prefer a higher classification number while carriers tend to prefer a lower classification number.

Question 60

Volume refers to how heavy a product is in relation to its size.

Question 61

Suppose that a shipment of products destined for a particular retailer is lost or damaged. If these products were going into general inventory replacement stock, then the retailer is entitled to recover the wholesale price plus freight costs (if they were paid).

Question 62

If you worked for Chippy, what new classification would you ask for? Give your reasons.

Question 63

U.S. freight railroads currently allow 24 hours of free time for unloading rail cars and 48 hours of free time for loading rail cars.

Question 64

Freight bill audits are designed to detect errors that result in overcharges and to correct those errors in the future.

Question 65

Expediting refers to determining a shipment's location during the course of its move.

Question 66

Classifications are based on both cost and value of service. From the carriers' standpoint, how has cost of service changed?

Question 67

The bill of lading is an invoice, submitted by the carrier, requesting to be paid.

Question 68

You work for the motor carrier classification bureau and notice that the relationship between the weight of potato chips and the weight of packaging has changed. How, it at all, should this influence changes in the product's classification?

Question 69

Some transportation managers utilize performance scorecards that contain a list of relevant attributes and an evaluation of each carrier on every attribute.

Question 70

Demurrage is a penalty payment associated with railroads, while detention is a penalty payment associated with motor carriers.

Question 71

One of Chippy's own trucks, used for local deliveries, has two axles and an enclosed body measuring (inside) seven feet by eight feet by twenty feet and is limited by law to carrying a load of no more than 8,000 pounds. Because the truck is not supposed to be overloaded, what combinations, expressed in terms of cartons of each, of new- and old-style chips can it legally carry? (Hint: use a piece of graph paper.)

Question 72

Small shipments refer to those that can be handled relatively expeditiously and inexpensively by a small package carrier.

Question 73

The volume of transportation freight claims has increased in recent years.

Question 74

From a carrier perspective, there may be a reluctance to accept small shipments because they tend to require a high degree of manual labor.

Question 75

In demurrage-related averaging agreements, slow equipment returns can be offset by fast equipment returns.

Question 76

Concealed loss and damage claims are some of the most difficult for shippers and carriers to handle.

Question 77

Given the existing LTL classification of 200, how has value of service to the customer changed?

Question 78

A freight claim must be filed within six months of the shipment's delivery date.

Question 79

Expedited shipments by motor carriage can sometimes provide faster and more reliable service than expedited shipping involving air transportation.

Question 80

A routing guide can provide a variety of shipment-related information such as shipment preparation and a list of preferred carriers for shipment moving between two points.