Supply Chain Management Review
Quotas are example of: a)Quantitative trade barriers b)Tariff barriers c)Qualitative trade barriers d)Non-tariff barriers
D. Non-tariff barriers
When exporting from the U.S., which harmonized code is used? a)HTSUS b)WCO HTS c)Schedule B d)Schedule B or HTSUS when allowed
D. Schedule B or HTSUS when allowed
Under the free trade zone program: a)A company can delay, eliminate, or reduce payment of duties b)A company can have 99% of its duties refunded should the product be exported c)A company can have a small portion of its duties refunded should the product be exported d)A company can have duties delayed or eliminated, but not reduced.
a)A company can delay, eliminate, or reduce payment of duties
A company in Beijing, China purchases machines from a manufacturer in Chicago, IL. The terms of sale are that any repair parts while a machines is under warranty, are to be replaced by the Chicago company at no cost. The Chicago company pays all freight, insurance, and taxes associated with shipping the parts to China. For such as parts shipments, which Incoterm would be appropriate? a)DDP Beijing, China. b)DDP Chicago, IL c)EXW Beijing China d)EXW Chicago, IL
a)DDP Beijing, China.
The US governmental agency responsible for negotiating and implementing free trade agreements is the: a)Commercial Service b)International Trade Administration c)Office of US Trade Representative d)Customs and Border Protection
c. Office of US Trade Representative
U.S. customs sees as its primary mission to a)Collect import duties b)Protect U.S. borders c)Protect against illegal immigration d)All of the above
d
In a bonded warehouse: a)A company can delay, eliminate, or reduce payment of duties b)A company can have 99% of its duties refunded should the product be exported c)A company can have a small portion of its duties refunded should the product be exported d)A company can have duties delayed or eliminated, but not reduced.
d) A company can have duties delayed or eliminated, but not reduced.
Which incoterm has the LEAST transportation responsibility for the BUYER: a)FOB b)CFR c)EXW d)DDP
d) DDP
What is the benefit to moving freight by intermodalism? a)Less risk of terrorism b)Less export control regulations c)Lower ocean freight costs d)Lower overall freight costs
d) Lower overall freight costs
Containers typically come in: a)10 and 20 foot length b)10 and 40 foot length c)20 foot length d)20 and 40 foot length
d)20 and 40 foot length
If your product being exported, is under export controls, you will consult Bureau of Industry and Security (BIS) to obtain the: a)Schedule B number b)Harmonized Tariff System Number c)NAFTA Preference Criterion d)Export Control Classification Number
d)Export Control Classification Number
For the next four questions, assume the following harmonized Code: 2120.92.3000. 2120 is the ______ a)commodity number b)subheading c)chapter d)heading
d)heading
In general, an Electronic Export Information (EEI) filing via the Automated Export System (AES) within the Automated Commercial Environment (ACE) is required if the total value of any single Schedule B number is greater than: a)$500 b)$1000 c)$1200 d)$2500
d. $2500
The purpose of USMCA preference criteria is to: a)Determine if a company qualifies b)Determine if an importer qualifies c)Determine if the country qualifies d)Determine if the product qualifies
d. Determine if the product qualifies
If a shipper in Quincy, IL is to make an ocean container destined for Hong Kong available at a Quincy warehouse and clear the goods for export, which Incoterm is most appropriate? a)FOB Quincy, IL b)EXW Hong Kong c)EXW Quincy, IL d)FCA Quincy, IL
d. FCA Quincy, Illinois
Assume a company is importing music boxes classified as 9208.10.0000. Also assume the music boxes fit inside a specially designed plastic case suitable to store the music box. Also assume there is a classification for plastic cases of 3919.20.2000. When importing these music boxes with the plastic cases, which harmonized code(s) would you use for the products? a)9208.10.0000 b)9208.10.0000 & 3919.20.2000 c)3919.20.2000 d)Neither - you simply list "multiple harmonized codes enclosed"
A. 9208.10.0000
Assume a company is importing music boxes classified as 9208.10.0000. Also assume there is a harmonized code 9208.05.0000 listed as "music boxes for educational purposes". If the company decides both codes are equally description for their product, which code would be used when importing? a)9208.10.0000 b)9208.05.0000 c)9208.10.0000 & 9208.05.0000 d)Neither since there is a conflict
A. 9208.10.0000
Assume a company is importing music boxes classified as 9208.10.0000? Also assume there is a harmonized code 9208.10.5000 listed as "parts of music boxes". The company is importing the music boxes complete with everything EXCEPT there are ornate legs the company adds which is manufacturers in the U.S. and glues to the imported music boxes. When importing the music boxes without legs, which code would be used? a)9208.10.0000 b)9208.10.5000 c)9208.10.0000 & 9208.10.5000 d)Neither since there is a conflict
A. 9208.10.0000
When importing from the U.S., which harmonized code is used? a)HTSUS b)WCO HTS c)Schedule B d)Schedule B or HTSUS when allowed
A. HTSUS
A potential benefit to an importer of the CTPAT program is: a)Less frequent US Custom inspections b)Lower import duties c)Facilitate containerization d)Facilitate insurance claims in case of loss
A. Less frequent US Custom inspections
Following on from the previous question. The company decides to begin manufacturing the music box legs in Brazil. When importing 1000 of the music box legs, which code would be used. a)9208.10.0000 b)9208.10.5000 c)9208.10.0000 & 9208.10.5000 d)When importing parts of more than 1000, U.S. Customs will classify.
B. 9208.10.5000
Custom Trade Partnership Against Terrorism (CTPAT) is: a)Mandatory for all U.S. exporters b)A voluntary program which certifies the security of a company's Supply Chain to the Customs and Border Protection c)Mandatory for all U. S. importers d)Only applies to Over The Road Truck shipments
B. A voluntary program which certifies the security of a company's Supply Chain to the Customs and Border Protection
A product manufactured in the US using foreign materials a)Will not qualify for USMCA duty free treatment b)May qualify for USMCA duty free treatment c)Will qualify for USMCA duty free treatment d)Will qualify for USMCA duty free treatment to Canada but not Mexico.
B. May qualify for USMCA duty free treatment
Import duties are an example of: a)Quantitative trade barriers b)Tariff barriers c)Qualitative trade barriers d)Non-tariff barriers
B. Tariff barriers
Conflicts between different levels of the same channel of distribution are referred to as: a)Horizontal conflicts b)Vertical conflicts c)Layer-based conflicts d)Parallel conflicts
B. Vertical conflicts
Following on from the preceding question, if later the company realized it needed more plastic cases without the music box as replacements for customers that have lost their plastic case, which harmonized code would you use when importing the cases? a)9208.10.0000 b)9208.10.0000 & 3919.20.2000 c)3919.20.2000 d)Neither - harmonized codes not needed for packing cases
C. 3919.20.2000
What is the difference between a distributor and an agent? a)A distributor acts as your export department; and an agent is already selling in your industry and it adds your product line in addition to the product it already sells internationally. b)An agent acts as your export department; and a distributor is already selling in your industry and it adds your product line in addition to the products it already sells internationally. c)A distributor generally stocks product but an agent does not. d)An agent earns its profits on a mark-up; but a distributor earns its profits on commissions.
C. A distributor generally stocks product but an agent does not.
According to US marking rules: a)Packing boxes must identify the consignee and the country of export b)Packing boxes must identify the consignee and country of origin c)All products not exempted by law are required to have the origin of the product on the product itself d)Ocean containers must identify port of embarkation
C. All products not exempted by law are required to have the origin of the product on the product itself
For the next four questions, assume the following harmonized Code: 2120.92.3000. 21 is the _____ a)commodity number b)subheading c)chapter d)heading
C. Chapter
A primary purpose of an international quotation is to: a)Confirm the freight costs to the foreign country b)Confirm the freight and insurance costs to the foreign country c)Confirm the selling price of the goods d)Confirm US eligibility to sell the goods
C. Confirm the selling price of the goods
When comparing the harmonized codes across many countries, they will be similar up to: a)First two digits b)First four digits c)First six digits d)First eight digits e)All ten digits as they are 'harmonized"
C. First six digits
USMCA (formerly NAFTA) agreement is what form of Regional Economic Integration? a)Common Market b)Customs Union c)Free Trade Area d)None of the above
C. Free Trade Area
The tariff applied to any product imported into the United States is determined by its: a)NAICS designation b)Export Control Classification Number (ECCN) c)Harmonized Tariff System Number (HTS) d)Electronic Export Information Filing
C. Harmonized Tariff System Number (HTS)
In calculating the landing price of a product, which of the following items would commonly be included? a)Inland freight, ocean freight, insurance, VAT b)Packaging, ocean freight, insurance, inland freight, VAT c)Inland freight, ocean freight, insurance, customs costs d)Ocean freight, insurance, customs costs, VAT
C. Inland freight, ocean freight, insurance, customs costs
The following are some of the improvements in the new USMCA agreement from NAFTA EXCEPT: a)To Qualify for zero tariffs, products must have 75% domestic contents b)US farmers will get more access to Canadian dairy markets c)Intellectual property and digital trade - terms of copyright are at 40 years. d)Agreement expires or sunsets after 16 years.
C. Intellectual property and digital trade - terms of copyright are at 40 years.
In the Harmonized Code, Chapter 7 is titled "Edible Vegetables and Certain Roots and Tubers". When classifying a vegetable, one thing for sure is that: a)It will be classified somewhere in Chapter 7 since 'vegetable' is in the title b)It will be classified in Chapter 7 as long as the proper noun for the vegetable is found in Chapter 7 c)It may or may not be classified in Chapter 7 depending on the section or chapter notes. d)It may or may not be classified in Chapter 7 depending on the General Rules of Interpretation.
C. It may or may not be classified in Chapter 7 depending on the section or chapter notes.
Some countries require imported products to meet particular product standards, such as the CCC mark. Though these are arguably safety issues, many would argue they are: a)Tariff barriers b)Product standard barriers c)Non-tariff barriers d)The global impact of the WTO
C. Non-tariff barriers
VAT in most countries is a: a)Value added tax - applied to all imports b)Value added tax - applied to all services c)Tax essentially acting as a national sales tax d)Tax essentially acting as a manufacturing tax
C. Tax essentially acting as a national sales tax
The CE mark is a: a)Product quality standard b)Product safety standard c)Procedures standard d)Document required to EU customs clearance
D. Document required to EU customs clearance
Which of the following would be a common element found in most distributor agreements? a)Incoterm clause b)Logistics clause c)Tariff clause d)Exclusivity or non-exclusivity clause
D. Exclusivity or non-exclusivity clause
The purpose of a U.S. Customs Binding Rule is to: a)Obtain final confirmation of the proper harmonized code for future imports b)Obtain final confirmation of the % duty to be applied when importing the product c)Resolve contractual disputes between two importers d)Resolve contractual disputes between an overseas exporter and an U.S. importer
a)Obtain final confirmation of the proper harmonized code for future imports
What is the growing concern about the use of EXW as an Incoterm? a)That the exporter is technically not responsible to clear the goods for exports, yet it may still have legal obligations related to export documents. b)That it can be very difficult to accurately calculate foreign duties. c)That it is primarily suited for non-containerized freight. d)It is simply too expensive for the seller.
a)That the exporter is technically not responsible to clear the goods for exports, yet it may still have legal obligations related to export documents.
What is the purpose of a freight forwarder? a)To assist with virtually all freight aspects including documentation and consolidation b)To manage freight exchanges between truck and rail c)To manage freight exchange between rail and ocean d)To forward freight during overseas facility moves
a)To assist with virtually all freight aspects including documentation and consolidation
For the next four questions, assume the following harmonized Code: 2120.92.3000. 2120.92.3000 is the ____ a)commodity number b)subheading c)chapter d)heading
a)commodity number
When would a US company be liable to collect/charge for VAT? a)When it is the exporter of record b)When it is the importer of record c)When it invoices above $1200 d)Never - it is an overseas function only
b) When it is the importer of record
The multinational organization that was created to help promote global trade is a)International Monetary Fund b)World Trade Organization c)World Bank d)United Nations
b) World Trade Organization
Under the duty drawback program: a)A company can delay, eliminate, or reduce payment of duties b)A company can have 99% of its duties refunded should the product be exported c)A company can have a small portion of its duties refunded should the product be exported d)A company can have duties delayed or eliminated, but not reduced.
b)A company can have 99% of its duties refunded should the product be exported
During an ocean voyage the ship's captain determines that for the ship's safety, twenty five (25) containers must be thrown overboard to save the ship from imminent danger. For most international shipments, which statement is true? a)Only shippers with containers that were thrown overboard share equally the loss of the value of the overboard containers b)All shippers with containers remaining on board share equally the cost of the value of the containers thrown overboard to save the ship. General Average Insurance would protect them from such financial risk. c)Each shipper with a lost container will be liable for the value of their own container d)Since it was a decision specifically declared by the ship's captain, no Shippers face potential loss as they revert to the ship transporting the containers
b)All shippers with containers remaining on board share equally the cost of the value of the containers thrown overboard to save the ship. General Average Insurance would protect them from such financial risk.
Which of the following incoterms would mean the main carriage and insurance is paid by the seller? a)FAS b)CIF c)FOB d)EXW
b)CIF
MERCOSUR is an agreement concerning trade on the continent of: a)Asia b)South America c)Europe d)Africa
b)South America
Which of the following is a true statement regarding import duty and VAT? a)They are both taxes applied to imports b)They are both taxes, but import duty applies to imports and VAT is generally applied to all products c)They are essentially the same thing d)Import duty is applied to imports, VAT is applied to exports
b)They are both taxes, but import duty applies to imports and VAT is generally applied to all products
For the next four questions, assume the following harmonized Code: 2120.92.3000. 2120.92 is the _____ a)commodity number b)subheading c)chapter d)heading
b)subheading
US duty drawback is: a)Applied equally for all countries of import / export. b)Applied equally for all countries of import / export other than European Union. c)Applied equally for all countries of import / export other than Canada and Mexico. d)Only available within members of the United Nations Convention for the International Sales of Goods
c) Applied equally for all countries of import / export other than Canada and Mexico.
A company in U. K. sells their products to a company in Kenya, East Africa. The Kenyan Buyer to receive the products at the port of Mombasa will pay for and arrange ALL transportation from origin to destination. The U.K. company has their manufacturing facility in London, where it will ship from. Which INCO Term should be used? a)EXW Mombasa b)FCA Mombasa c)EXW London d)CIF London
c) EXW London
An Ad Valorem Duty is a duty applied based on: a)Product weight b)Product size c)Product value d)Product quota
c) Product value
A Korean customer has requested a U.S. shipper take responsibility and pay the freight and insurance for a ro-ro order from Quincy to be loaded on board a ship in Long Beach. Which Incoterm would be appropriate? a)EXW Long Beach, CA b)FAS Long Beach, CA c)FOB Long Beach, CA d)FCA Long Beach, CA
c)FOB Long Beach, CA
How many forms of Economic Integration are there? a)27 b)2 c)5 d)50
c. 5
