Supply Chain CH 9

What is the abbreviation for a truck trailer which is placed on a flat railcar that would then be pulled by a train engine?

TOFC

Which of the following international intermediaries helps foreign buyers and sellers find each other and then handles all of the shipping arrangements and documentation preparation?

Trading COmpany

Which of the following is NOT consistent with a decentralized warehousing system? a. lower safety stocks required b. shorter lead times c. lower transportation fees d. higher total operating costs

a. lower safety stocks required

A furniture manufacturer presently owns a total of four warehouses in the following cities Sacramento, Phoenix, Cincinnati, and Atlanta. The average inventory levels for the four warehouses are 8000 units, 10,000 units, 10,000 units, and 8000 units, respectively. They plan on moving all of their inventory to one warehouse in Memphis. Using the square root rule, what will be the required average inventory level at the new central Memphis warehouse required to maintain the system's present 98% customer service level? (Choose the closest answer.)

24,500

Does risk pooling favor a centralized or decentralized warehousing system? Why?

CENTRALIZED warehousing system because through the square root rule, illustrates the relationship between inventory, customer service levels, and the number of warehouses. By using the square root rule formula it can be seen that demand in different markets is negatively correlated. This means that high demand in one area will likely be offset by low demand in another area. Thus, having fewer warehouses offsets the need for a large pool of safety stock distributed amongst a large number of warehouses. In other words system variability can be better controlled from one centralized warehouse versus a large number of warehouses all of which would have to have their own pool of safety stocks in order to control demand variability within their region.

Which of the following carriers must publish and offer the same rates to all shippers between designated locations? Because of these requirements they are the most heavily regulated of all the carrier classes.

Common Carrier

What does COFC stand for in the transportation industry?

Container on a flat car

Which intermediary should International Cosmopolitan consider in helping them import the product into United States? Why?

Custom Brokers because They are knowledgeable on documentation and other customs related areas

What does LTL stand for in the transportation industry?

Less than truckload

Which intermediaries should International Cosmopolitan consider in finding customers in United States and exporting the product out of a France? Why?

a trading company

Which of the following is similar to a travel agent for cargo since they provide services like documentation completion, special rate handling, and customs clearance, in addition to their consolidating of small shipments to fill entire truckloads? a. Transportation Broker b. Freight Forwarder c. Shippers Association d. Integrated Logistics Service Provider

b. Freight Forwarder

Which of the following is consistent with a centralized warehousing system? a. higher safety stocks required b. longer lead times c. lower transportation fees d. higher total operating costs

b. longer lead times

Which of the following would be considered an act of deregulation? a. Reed Bullwinkle act − legalized rate bureaus or conferences b. Granger law − Established maximum rates, prohibited discrimination, and forbade mergers for railroads. c. Trucking Industry Regulatory Reform Act − Motor carriers freed from filing rates with the Interstate Commerce Commission d. Freight Forwarders Act − Allowed Interstate Commerce Commission control over freight forwarders; controlled entry, rates, and services.

c. Trucking Industry Regulatory Reform Act - Motor carriers freed from filing rates with the Interstate Commerce Commission

Which of the following types of warehouses takes a large number of LTL shipments and repackages them in TL or CL quantities to a manufacturer or user-facility located in another area or region?

consolidation warehouses

The acts of receiving shipments, breaking down shipments, repackaging shipments, and distributing components to a manufacturing location or finished products to customers by a distribution center is referred to as:

cross docking

Which of the following is a trend in warehousing? a. Traditional warehouses moving away from storage towards distribution b. locating your warehouses closer to suppliers c. warehouses engaging in cross docking activites d. all of the above

d. all of the above

Which of the following is NOT consistent with a decentralized warehousing system ? a. higher safety stocks required b. shorter lead times c. lower transportation fees d. lower total operating costs

d. lower total operating costs

t or f: A small LTL shipment that originates on a truck in Los Angeles and is moved from Los Angeles to Phoenix where it is unloaded and put onto another truck for final shipment to Denver would be considered an intermodal shipment since it utilizes more than one vehicle during shipment.

false

t or f: Because air transport is so expensive the best cargo candidates for air travel are those cargo shipments that are worth more than $25,000 per unit.

false

t or f: Efficient supply chain management distribution requires that warehouses concentrate their efforts on storing purchases, work in progress inventories, and finished goods inventories, while trucking companies and retail facilities take care of receiving shipments, breaking down shipments, repackaging, and the distribution of components.

false

t or f: The responsibility of transportation is to create both shipment utility and inventory utility, which means that products will be delivered efficiently and be kept in stock for convenient purchase.

false

t or f: International intermediaries can provide shipping, consolidation, and other import and export services. Some examples of these international intermediaries include: foreign freight forwarders, NVOCCs, FTZs, and TOFCs.

false, they are Foreign freight forwarders, NVOCCs, Trading companies, and Customs Brokers.

According to the textbook, the largest ocean containerships can carry how many twenty-foot containers?

over 10,000

Which of the following carriers typically transports goods for the company that owns the carrier, they are not subject to economic regulation, and since the fleets are rather large the cost of transport is very likely less than if the company had hired another company to provide the service?

private carrier

t or f: A shipment that originates in Los Angeles and is placed inside a sealed standardized 8' by 8' by 20' container attached to a truck trailer and is moved from Los Angeles to Phoenix where the container is then moved to a railcar for final shipment to Denver where it would then be loaded onto another truck trailer would be considered an intermodal shipment since the container remained sealed throughout the shipment.

true

t or f: According to the textbook, the five basic modes of transportation are motor, rail, air, water, and pipeline.

true

t or f: Because air transport is so expensive the best cargo candidates for air travel are those cargo shipments with a high cost to weight ratio.

true

t or f: Efficient supply chain management distribution requires that modern warehouses concentrate their efforts on a wide array of warehousing and distribution functions like storing purchases, work in progress inventories, and finished goods inventories, receiving shipments, breaking down shipments, repackaging, and the distribution of components.

true

t or f: In order to provide more comprehensive delivery service, some freight-only airlines have invested in developing their own motor carrier fleets to provide full door to door service delivery.

true

t or f: Risk pooling is a strategy that attempts to use fewer warehouses to decrease the required safety stock levels since the negatively correlated market demands reduce the overall demand variance across the markets which the centralized warehouse services.

true

t or f: Risk pooling is a strategy that attempts to use more warehouses to decrease the required total safety stock level since the negatively correlated market demands reduce the overall demand variance across the markets which the decentralized warehouses service.

true

t or f: Some of the e-commerce related services that transportation companies offer nowadays to remain competitive include allowing customers to plan itineraries, get freight quotes, and track shipments online.

true

t or f: The primary difference between FOB origination and FOB destination is that FOB destination requires that the supplier legal own the product until it reaches the destination; in FOB origination the buyer takes ownership immediately and is thus responsible for arranging delivery.

true

t or f: The responsibility of transportation is to create both time utility and place utility, which means that products will be delivered at precisely the right time to the desired location.

true

t or f: When a supplier provides a price quote to a buyer for supplies that includes transportation to the buyer's location this is known as FOB destination pricing, or free on board to the shipment's destination.

true

t ot f: While transportation regulation and deregulation both have their supporters, proponents of deregulation consider it to be good since it is said to encourage competition and allows the negotiation of prices to dictate market costs.

true