Deck 18: Global Logistics

Question 1

The five major decisions addressed by logistics managers are

A) transportation, warehousing, location, reverse logistics, and third-party logistics.
B) location, transportation, warehousing, reverse logistics, and tactical.
C) strategic, third-party logistics, warehousing, transportation, and location.
D) None of the above answers is entirely correct.

Answer 1

strategic, third-party logistics, warehousing, transportation, and location.

Question 2

Which of the following statements concerning logistics networks is NOT correct?

A) Network design decisions are strategic because they can impact the competitive ability of the firm.
B) Typically logistics networks start with the warehouses, then show shipping to distribution centers, which in turn ship to customers.
C) The two primary logistics network decisions are the number of warehouses needed and where they should be located.
D) Network design decisions affect both logistics cost and delivery time to customers.

Answer 2

Typically logistics networks start with the warehouses, then show shipping to distribution centers, which in turn ship to customers.

Question 3

Which of the following transportation modes has the lowest cost per ton?

A) Truck.
B) Rail.
C) Pipeline.
D) Multiple mode.

Answer 3

Rail.

Question 4

Which of the following integration partnerships is especially important when considering logistics?

A) Logistics and finance.
B) Logistics and information systems.
C) Logistics and marketing.
D) Logistics and human resources.

Question 5

The chief advantage of shipping by truck is

A) lower cost.
B) the ability to consolidate shipments.
C) location flexibility.
D) the ability to ship less-than-truckload amounts.

Question 6

Complete the following definition of logistics according to the Council of Supply Chain Management Professionals: Logistics plans,implements,and controls the forward and reverse flows and storage of goods and related information between the point of origin and consumption…

A) in order to meet the firm's requirements.
B) in order to meet customer requirements.
C) in order to meet regulatory requirements.
D) in order to provide the lowest-cost solution.

Question 7

Which of the following does NOT represent one of the critical logistics decisions?

A) The trade-offs between transporting product by rail or waterway (e.g., barge).
B) Transitioning from traditional warehouses to distribution centers.
C) Insourcing logistics through company-owned aircraft.
D) Using market surveys to estimate future demand.

Question 8

Annual logistics expenditures worldwide are

A) less than 5% of the global GDP (less than approximately $1.5 trillion).
B) between 5% and 10% of the global GDP (between approximately $1.5 and $3.0 trillion).
C) between 10% and 20% of the global GDP (between approximately $3.0 and $6.0 trillion).
D) more than 20% of the global GDP (more than approximately $6.0 trillion).

Question 9

In addition to cost,which of the following is a key factor to consider in transportation mode decisions?

A) Performance against promised delivery times.
B) Access to the mode, from both the supplier and customer perspectives.
C) Special handling requirements.
D) All of the above.

Question 10

Pooled delivery is the term used to describe

A) when two or more companies arrange to consolidate shipments in the same truck.
B) when a company consolidates two or more shipments into a single shipment to a location.
C) when a company outsources delivery to a common carrier such as UPS or FedEx.
D) none of the above.

Question 11

Which of the following is NOT a basic type of distribution center?

A) Cross-docking distribution center.
B) Break-bulk distribution center.
C) Finished goods distribution center.
D) Consolidation distribution center.

Question 12

Which of the following is NOT a significant contributing factor to warehouse location decisions?

A) Cost of facility maintenance.
B) Government incentives.
C) Proximity to suppliers.
D) All of the above are significant contributing factors.

Question 13

Which of the following is correct concerning government and transportation?

A) Governments own parts of transportation systems, even whole systems.
B) Deregulation in the United States meant transportation companies could raise their prices.
C) Outside the United States, governments tend to own more of the transportation systems in place.
D) All of the above.

Question 14

Which of the following is true concerning logistics?

A) Logistics is often included as the "place" in the 4Ps of marketing.
B) Inventory management is often included in definitions of logistics.
C) The government plays a key role in logistics decisions.
D) All of the above.

Question 15

Which of the following was NOT given as one of the five modes of transportation?

A) Water.
B) Internet.
C) Pipelines.
D) Air.

Question 16

When a distribution center immediately sorts large incoming shipments into smaller lots and into empty waiting trucks,this is called

A) freight forwarding.
B) breaking bulk.
C) cross-docking.
D) none of the above.

Question 17

Which of the following is NOT a common function performed by a warehouse or distribution center?

A) Final assembly and product testing.
B) Storage of a raw material used in production.
C) Labeling and pricing of products.
D) Collection point for returned products.

Question 18

A decision to consolidate shipments typically means the company has placed an emphasis on

A) reducing costs.
B) improving delivery service.
C) decreasing warehouse inventory.
D) all of the above.

Question 19

Which of the following is NOT correct concerning the economics of transportation?

A) Larger shipments cost less per unit of weight.
B) Economies of distance replace economies of scale in transportation decisions.
C) Long distances drive down the cost per mile.
D) The transportation cost per unit increases as the utilization of container space decreases.

Question 20

Comparing warehouses and distribution centers,which of the following is true?

A) Warehouses that ship directly to retail stores are called distribution centers.
B) Distribution centers place more emphasis on fast transfer of material than warehouses.
C) Distribution centers place more emphasis on maintaining minimum inventories than warehouses.
D) All of the above are true.

Question 21

Transportation costs are accounted for in the basic EOQ model.

Question 22

Transportation mode decisions are generally driven by two major factors: cost and service.

Question 23

Governments have shown strong resistance to giving outright subsidies and tax incentives to attract firms to locate their facilities in a particular city or country.

Question 24

Using the same information given above (Problem 34),if today is Monday and the shipment must be received at the warehouse by this Friday,which is the best mode of transportation?

A) Direct truck.
B) LTL.
C) Rail.
D) Air.

Question 25

The Stout Warehousing Company offers logistics network design and warehouse management services to customers along with traditional trucking and storage services.This type of company is known as

A) an advanced logistics provider.
B) a contract transportation and warehouse provider.
C) a third-party logistics provider.
D) an IT (information technology) enhanced logistics provider.

Question 26

The ability to ship products from different points of origin to different destinations is a dimension of service to be considered when choosing a transportation mode.

Question 27

Which of the following statements concerning third-party logistics providers (3PLs)is true?

A) Small businesses avoid 3PLs because their shipping volume is very low.
B) Global companies often use 3PLs to avoid the complexity of international logistics.
C) Companies in rapidly changing markets find using 3PLs limits their flexibility.
D) All of the above statements are true.

Question 28

Logistics decisions span three modes of transportation: road (truck),rail,and air.

Question 29

Logistics includes the planning and control of returned goods and related information from the customer to the manufacturer.

Question 30

For most firms,the optimal number of warehouses in a logistics network

A) is calculated using classic center-of-gravity analytics.
B) is where the total inbound transportation and storage costs are minimized.
C) is where the total outbound transportation and storage costs are minimized.
D) is where the total inbound transportation and storage costs equal the total outbound transportation and storage costs.

Question 31

Which of the following statements is correct concerning warehouse location center-of-gravity analytics?

A) The center-of-gravity approach employs an algorithm to find the lowest cost from every conceivable route in the logistics network.
B) The center-of-gravity approach includes labor and tax rates in finding the low-cost solution.
C) The center-of-gravity approach assumes that transportation cost is proportional to the distance traveled and weight carried.
D) All of the above are correct.

Question 32

Smith Equipment has three separate shipments to customers all in the same city.The shipment weights are 20,000 lbs.25,000 lbs.,and 10,000 lbs.Smith Equipment's carrier charges $14 per hundredweight (cwt)if each shipment is sent separately.If the three shipments are consolidated at Smith Equipment's warehouse and sent in a single truck,the carrier charges $11 per cwt with a $500 consolidated delivery fee per destination added.Smith Equipment should

A) send the shipments separately at a savings of $1,500.
B) consolidate the shipments at a savings of $1,635.
C) consolidate the shipments at a savings of $150.
D) either choice-the shipment costs are equal.

Question 33

Bringing several small shipments together to make a single larger shipment is called consolidation.

Question 34

Materials handling,transportation,and warehousing are elements of

A) logistics.
B) purchasing.
C) demand chain management.
D) fill rate.

Question 35

Larger shipments cost more per pound.

Question 36

Which of the following is the most basic service provided by third-party logistics providers (3PLs)?

A) Logistics network design.
B) Warehousing.
C) Transportation.
D) Inventory management.

Question 37

Which of the following statements concerning third-party logistics providers (3PLs)is FALSE?

A) In business, there is an increasing trend to outsource some or all of logistics to 3PLs.
B) Even companies that consider logistics to be a core competence are routinely outsourcing logistics to 3PLs.
C) Some companies outsource all logistics to 3PLs, while others use a mix of internal logistics and 3PLs.
D) All of the above are false.

Question 38

Using the same information given above (Problem 32),assume the carrier promises one-day delivery on the separate shipments,and two-day delivery on the consolidated shipment.If shorter delivery time is important to these customers,Smith Equipment should

A) consolidate the shipments because the savings is substantial.
B) consolidate the shipments even though the savings are minimal.
C) send the shipments separately even though this is a slightly more expensive option.
D) send the shipments separately even though this is a significantly more expensive option.

Question 39

As the number of warehouses in a logistics network decreases,

A) inbound transportation and storage costs decrease.
B) inbound transportation and storage costs increase.
C) outbound transportation and storage costs decrease.
D) There is no change in either inbound or outbound transportation and storage costs.

Question 40

The first step in determining a logistics strategy is to

A) map the existing logistics network to provide a baseline.
B) decide between retaining logistics as an internal function or outsourcing.
C) determine the appropriate modes of transportation for minimizing cost and meeting the needs of customers.
D) apply the operations and supply chain strategy to clarify logistics objectives.

Question 41

Classic center-of-gravity analytics is the final step in warehouse location decisions.

Question 42

Third-party logistics providers can play a significant role when disaster strikes,such as getting supplies to hurricane victims.