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SCMN 3720
Exam 1
| Question | Answer |
|---|---|
| What are the 3 Supply Chain Flows? | Products, Information, Finances |
| What is the glue that holds a supply chain together? | Transportation |
| Why do retailers now have the power of the supply chain? | They Represent the consumer |
| What is the correct formula for price elasticity of demand? | % change in quantity demanded divided by the % change in price |
| What are the top 3 countries in exports in order? | China, USA, Germany |
| What environmental event significantly increased the visibility of industrial transportation safety? | The Exxon Valdez accident |
| What is the definition of landed cost? | The total cost of getting something to its destination |
| Reliability in transportation is defined as what? | Consistency of transit time |
| Which mode of transportation has had the greatest impact on the location of major cities? | Water |
| In what decade did senior managers begin to recognize the profit potential associated with proper supply chain management? | 1990s |
| What was the primary reason for the creation of the US interstate road way system? | Defense |
| A transportation shipment of 20 tons for 2000 miles would be how many ton miles? | 40000 Ton Miles |
| What are the top 3 countries in imports in order? | USA, China, Germany |
| If a product costs $10 to produce the firm expects 10% margin on the cost to produce, and transportation per unit costs $1, what is the least price the firm is likely to accept for the product? | $12 |
| Based upon Lardner’s Law, if transportation cost is cut in half, how much does the relevant market increase? | 300% |
| What are the 3 major societal function categories with higher percentages of GDP than Transportation? | Housing, Health Care, Food |
| What is the only average expenditure that is higher than Transportation? | Housing |
| What percentage of ton mile traffic in the US is carried by air? | Less than 1% |
| Aggregate transportation expenditures are approximately what percentage of GDP? | 9% |
| During which presidential administration was legislation passed in support of the interstate highway system? | Eisenhower |
| A truck breakdown is what kind of risk? | Delivery Delay |
| The top 30 countries account for approx. __% of the world’s exports? | 84% |
| Value of service pricing is best defined as: | What the traffic (market) will bear / or what you can get for the service |
| What are the conditions for pure competition? | Large numbers of sellers, sellers and buyers small enough so that no one can overly influence the market, unrestricted entry, homogeneous product or service |
| What are the 4 steps in transportation risk management? | Identify the risk, analyze the risk, manage the risk, review and monitor |
| A deliberate product contamination risk is called? | Tampering |
| What are the two parameters used to assess risks? | Impact and Probability |
| What is the simplest way to eliminate risk? | Risk Avoidance |
| What is the most common type of risk transfer? | Insurance |
| Reverse logistics systems are developed for what purpose? | Returning unacceptable products |
| Which mode of transportation moves the most tones of freight in the USA? | Motor Carriers (Trucking) |
| Which mode of transportation (other than light duty vehicles) is most important in terms of passenger miles in the USA? | Air Carriers |
| Not putting all of your eggs in one basket is what type of transportation risk strategy (and what category does this fall in)? | Hedging (Risk Reduction) |
| What classification factors are used to determine the rating of a specific commodity? | Product Density, Stowability and Handling |
| 35. What is the term for an external business that handles all logistics for another company? | 3PL |
| Define Business Continuity planning? | The processes and procedures an organization puts in place to ensure that essential functions can continue during and after a disruption or disaster |
| What 3 basic criteria are typically most important in determining how much to charge or pay for a shipment? | Weight, Zip to Zip code route, Type of commodity |
| Name one of the tactical and operational planning capabilities of a TMS: | Routing and scheduling / carrier selection / mode selection / load consolidation / planning |
| How much can you expect to reduce freight costs if you implement a TMS correctly? | 6-10% |
| Name one potential benefit of Blockchain to SCM: | a. Reduce paperwork, cost, fraud b. Increase transparency c. Maersk and IBM are researching implementing blockchain in shipping |
| What is an ELD and what does it do? | a. Electronic Logging Device b. Provides wireless data on truck engine RPMs, and truck activities to log what is happening in the truck and how the truck is running |
| What were the $ level of imports, exports, and the difference for the USA in 2015? | Imports - $2,329,059.80 Trillion / Exports - $1,578,971.70 Trillion / Difference - $750,088.10 Billion |
| What is it called when trade is beneficial if cost of production for the same product differ between countries? | Absolute Advantage (Specialize in that project) |
| What is it when trade is also beneficial even if one country has lower cost of production than other country in multiple products? | Comparative Advantage |
| What are some major contributing factors influencing global flows and trade? | Population size and age distribution, Urbanization, Land and resources, Technology and information, and Globalization |
| What is it called when you don't have good information flow and as you go farther backward on the supply chain, there is more inventory to prepare for just in case not just in time? | Bull Whip effect |
| What are some examples of the historical significance of transportation? | Transcontinental railroad of 1869, Nile River, Roman Roads |
| How have transportation routs affected population distribution? | People populate near water, transcontinental railroads in the west from east coast |
| What are some important milestones in US transportation? | Steam Boat, Car, Railroad |
| What are the transportation measurement units for passengers and freight? | Passenger/Ton Miles |
| Place Air, Rail, Bus, and Light Duty Vehicles in descending order of passenger miles. | Light Duty vehicles --> air --> bus--> rail |
| Place Air, Truck, Rail, Water, and Pipeline in descending order of ton miles of freight in US. | Trucking --> Rail --> Pipeline --> Water --> Air (less than 1%) |
| What is the sensitivity of customers to changes in price? | Elasticity |
| What type of transportation demand is inelastic, and what type is elastic? | Demand for Aggregate transportation is inelastic but individual modes have an elastic demand |
| What is it called when down the line, the demand for freight doesn't exist without a need for goods? | Derived Demand |
| What is the total time moving from supplier to customer? | Transit Time |
| What is consistency transit times, consistent travel times, objective measure with no bias? | Reliability |
| What is the ease of getting to and from your pick up and delivery points? | Accessibility |
| What is the ability to service customers? | Capability |
| What is it called when you make sure the goods arrived unharmed? | Security |
| Explain Time, place, and quantity utility. | Have to have right place, right time, and quantity inventory must be on schedule for JIT (Ponchos at a football game) |
| What is Lardner's Law? | When transportation cost is reduced, the area where the producer can compete is increased in a directly proportional basis |
| Explain "economies of scale" and how this relates to the impact of lower transportation costs. | As production of a good increases the cost of producing each additional unit falls --> lower shipping cost |
| How are land values affected by transportation routes? | If there are good transportation routs, people can live further from cities / in new areas driving up the property values in the area due to their closeness |
| What % of US GDP does transportation account for, and where does it stand relative to housing, food, and healthcare? | Third in 9% Healthcare is second 15.4% and Housing is first at 17.8% |
| What % of average household expenditures in the US goes to transportation, and where does it stand relative to other categories? | 17% and it is second to Housing and above insurance, food, healthcare, and apparel |
| How does transportation affect the environment? | Pollution, safety, energy, greenhouse gases |
| What are the benefits of a TMS? | Reduced order costs, load consolidation, carrier/mode selection, identify invoice, / saves roughly 6-10% |
| What are some examples of sustainability initiatives? | Improved fuel efficiency, advanced technology engines, renewable energy equipment, emission reduction |
| What is the current state of self driving trucks? | Still being researched and tested for safety and accuracy |
| What is truck platooning? | Driver less trucks following in tandem with a lead and follow truck, both with drivers |
| What conditions exist in pure competition? | High number of sellers, size of buyers and sellers is small, products and services are homogeneous, low restriction to market entry, high demand elasticity |
| What is it when only one seller, no close competition or substitute, restricted entry, seller sets price? | Monopoly |
| What is it when there are a few large sellers, relatively homogeneous products, substitutability, mutual interdependence? | Oligopoly |
| What is different about monopolistic competition vs monopoly? | Many small sellers, product differentiation, no one controls significant portion of market, no interdependence |
| What two types of costs can be used to base prices upon in Cost- of Service pricing? | Marginal and Average |
| What is Value of Service pricing based on? | Charging what the market can bear |
| What is a headhaul? | There is more freight moving from one region to another than is being transported back (more moving from point A to point B than vice versa) |
| What is a backhaul? | have less volume and lower rates than headhaul rates |
| What classification factors are used to determine the rating of a specific commodity? | Product density, storability and handling, and liability |
| If everything else is the same, why is the price to ship a full truckload quantity less than the sum of the prices for LTL quantities that fill up the same size truck? | Reducing handling costs/ requirements |
| What 3 basic criteria are typically most important in determining how much to charge or pay for a shipment? | Distance, Weight, Type of Commodity, Zip to Zip route |
| What is the difference between a rate and a price, and how has economic deregulation impacted to use of these terms? | Rate: how much you can charge for movement of goods (lawful charge) / Price: depends on demand (based on market forces) |
| What is a significant delay, interruption or stoppage in the flow of trade caused by natural disaster, heightened threats, act of terrorism, or transportation security incident? | Transportation Disruption |
| What is the future freight movement event with a probability of occurrence and the potential for impacting supply chain performance? | Transportation Risk |
| What is it to identify risk, cause and effect, etc. to increase overall understanding in order to manage, reduce, transfer, and ultimately eliminate threats to the supply chain? | Transportation Risk Management |
| What are the 4 steps in the risk management process? | Identification, Assessment, Strategy Development, Review and Monitor |
| What are the 6 primary categories of risk? | Product loss, Product Damage, Product Contamination, Delivery Delay, Supply Chain Interruption, Security Breach |
| What are the 4 categories of risk management strategies? | Avoidance, Reductions, Transfer, Retention |
| T/F Replacing high levels of safety stock with timely information is one effective method to reduce the bullwhip effect in a supply chain. | True |
| T/F China is expected to have the largest population of any country in 2050. | False |
| T/F In 2030, it is estimated that 60% of the world's population that will live in urban areas. | True |
| T/F The supply chain management concept captured the attention of senior level executives in many organizations starting in the 1970s. | False |
| T/F Reverse logistics systems are developed for receiving payment from customers. | False |
| T/F Transportation has been described as the glue that holds the supply chain together. | True |
| T/F The 3 major flows in a supply chain are products, information, and money. | True |
| T/F Reliability is the transportation service characteristic defined as the trustworthiness of the carrier. | False |
| T/F The demand for transportation is considered an independent demand. | False |
| T/F The primary reason for the creation of the US interstate roadway system was to promote commerce. | False |
| T/F Air transportation has more passenger-miles that railroads and bus services combined. | True |
| T/F A transportation shipment of 75 tons for 125 miles would be 9375 ton-miles. | True |
| T/F Demand for transportation at the macro level is elastic, while demand for transportation at the micro level is inelastic. | False |
| T/F Approximately 10% of the freight ton-mile traffic in the US is carried by air. | False |
| T/F The first successful airplane flight occurred in 1903. | True |
| T/F Various studies indicate that the use of a TMS helps an organization reduce freight costs by 12-20%. | False |
| T/F In 2015, there were 667 fatalities from railroad carriers, airlines, and water cargo transporters combined while large truck and bus crashes resulted in fewer than 300 fatalities. | False |
| T/F Truck platooning is an autonomous concept that does not use human drivers. | False |
| T/F The use of aerodynamic devices and low rolling resistance tires can result in a net fuel savings of 10% or more. | True |
| T/F TMS software sales are projected to reach $30 billion by the end of 2025. | True |
| T/F Maersk Lines is teaming with Microsoft to use Blockchain technology in ocean shiping | False |
| T/F The transportation industry created 37% of greenhouse gas emissions in 2015. | False |
| T/F It is possible to achieve a 12 to 18 month ROI on a TMS Investment. | True |
| T/F Under transportation regulation, the amount found in a tariff payment to a carrier for performing a given transport is called a rate. | True |
| T/F Third degree price discrimination is best defined as charging different prices to different buyers who use the same commodity or service. | True |
| T/F Under pure competition, there are many sellers and the product is heterogeneous. | False |
| T/F A skimming price is a high price intended to attract a market that is insensitive to price, and it is a means to maximize profit. | True |
| T/F The main objective of deregulation in transportation was to create market driven pricing of transportation services free from regulatory invention. | True |
| T/F Product density, stowability, and handling, liability, are classification factors used to determine the rating of a specific commodity. | True |
| T/F Two separate concepts in Cost of Service pricing are prices based on average or marginal cost. | True |
| T/F The two parameters involved in risk assessment are cost and impact. | False |
| T/F Increasing the deductible on an insurance police is a risk avoidance strategy | False |
| T/F Costing the risk mitigation is one of the fours steps in the risk management process. | False |
| T/F The risk of temperature control failure in a refrigerated trailer is in the Product Contamination risk category. | True |
| T/F The risk of labor disruptions and strikes is in the Supply Chain Interruption risk category. | True |
| T/F The simplest way to eliminate risk is risk reduction. | False |
| T/F Insurance is a common method of risk transfer. | True |
| T/F Using the least cost service provider is a transportation risk reduction strategy. | False |
Created by:
Heritage2016