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IDIS 343 Exam 3 Questions and Answers 100% Pass

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IDIS 343 Exam 3 Questions and Answers 100% Pass Importance of an Effective Transportation System - Answers An efficient and inexpensive transportation system contributes to greater competition in the marketplace, greater economies of scale in production, and reduced prices for goods. - Greater competition: distant markets can be targeted easily. - Economies of scale: inexpensive transportation allows decoupling of markets and production sites. This provides a degree of freedom to choose production sites. - Reduced prices: consumers can enjoy goods at a lower price and higher standards of living. Basic transportation modes: - Answers - Water - Rail - Truck - Air - Pipeline Important service characteristics: - Answers 1. Price 2. Transit time and variability 3. Loss and damage Price - Answers • Price of transport service to a shipper is simply the linehaul rate for transporting goods and any accessorial or terminal charges for additional service provided. • In case of for-hire service, some additional costs: pickup at origin, delivery at destination, insurance, or preparing the goods for shipment. • In general: - Airfreight is the most expensive - Pipe and water carriage are the least costly - Trucking is about seven times more expensive than rail - Rail is about four times as expensive as water or pipeline movement. Transit Time and Variability - Answers • Average delivery time and delivery time variability rank at the top of the lists as important transportation performance characteristics. • For comparison, generally door-to-door service is used. • Variability refers to the usual differences that occur between shipments by various modes. Some general observations: - Answers • Over long distances, rail and air shipments approach constant average transit times, while truck transit times continue to increase. • On average, airfreight is the fastest mode for distances of more than 600 miles. Following are truckload, less than truckload and rail. • For distances less than 600 miles, air and truck are comparable. • For very short distances, transit time is influenced more by the pickup and delivery operation than the line-haul transit time. • For variability: rail has the highest delivery time variability and air has the lowest, with truck services being in the middle. • If variability is viewed relative to the average transit time for the transport service, air can be least dependable and truckload the most dependable. Loss and Damage - Answers • The most serious loss that the shipper may sustain has to do with customer service. • The shipment of goods may be for replenishing a customer's inventory or for immediate use. • Delayed shipments/arriving in unusable condition - inconvenience for the customer OR higher inventory costs OR backorders Rail - Answers - Long-hauler and slow mover of raw materials (e.g., coal, lumber, chemicals) - Low-valued manufactured products (e.g., food, paper, wood) - Rail service exists in two legal forms: common carrier or privately owned. • Common carrier: sells its transportation services to all shippers • Private carriers: shipper owned with the usual intent of serving only the owner. Truck - Answers - Transportation service for semifinished and finished products. - Main advantages: • providing door-to-door service • involving no loading-unloading between origin and destination • its frequency and availability • door-to-door speed and convenience - Less capable of handling all types of freight than rail due to safety restrictions.

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IDIS 343 Exam 3 Questions and Answers 100% Pass

Importance of an Effective Transportation System - Answers An efficient and inexpensive transportation
system contributes to greater competition in the marketplace, greater economies of scale in production,
and reduced prices for goods.

- Greater competition: distant markets can be targeted easily.

- Economies of scale: inexpensive transportation allows decoupling of markets and production sites. This
provides a degree of freedom to choose production sites.

- Reduced prices: consumers can enjoy goods at a lower price and higher standards of living.

Basic transportation modes: - Answers - Water

- Rail

- Truck

- Air

- Pipeline

Important service characteristics: - Answers 1. Price

2. Transit time and variability

3. Loss and damage

Price - Answers • Price of transport service to a shipper is simply the linehaul rate for transporting goods
and any accessorial or terminal charges for additional service provided.

• In case of for-hire service, some additional costs: pickup at origin, delivery at destination, insurance, or
preparing the goods for shipment.

• In general:

- Airfreight is the most expensive

- Pipe and water carriage are the least costly

- Trucking is about seven times more expensive than rail

- Rail is about four times as expensive as water or pipeline movement.

Transit Time and Variability - Answers • Average delivery time and delivery time variability rank at the
top of the lists as important transportation performance characteristics.

• For comparison, generally door-to-door service is used.

, • Variability refers to the usual differences that occur between shipments by various modes.

Some general observations: - Answers • Over long distances, rail and air shipments approach constant
average transit times, while truck transit times continue to increase.

• On average, airfreight is the fastest mode for distances of more than 600 miles. Following are
truckload, less than truckload and rail.

• For distances less than 600 miles, air and truck are comparable. • For very short distances, transit time
is influenced more by the pickup and delivery operation than the line-haul transit time.

• For variability: rail has the highest delivery time variability and air has the lowest, with truck services
being in the middle.

• If variability is viewed relative to the average transit time for the transport service, air can be least
dependable and truckload the most dependable.

Loss and Damage - Answers • The most serious loss that the shipper may sustain has to do with
customer service.

• The shipment of goods may be for replenishing a customer's inventory or for immediate use.

• Delayed shipments/arriving in unusable condition -> inconvenience for the customer OR higher
inventory costs OR backorders

Rail - Answers - Long-hauler and slow mover of raw materials (e.g., coal, lumber, chemicals)

- Low-valued manufactured products (e.g., food, paper, wood)

- Rail service exists in two legal forms: common carrier or privately owned.

• Common carrier: sells its transportation services to all shippers

• Private carriers: shipper owned with the usual intent of serving only the owner.

Truck - Answers - Transportation service for semifinished and finished products.

- Main advantages:

• providing door-to-door service

• involving no loading-unloading between origin and destination

• its frequency and availability

• door-to-door speed and convenience

- Less capable of handling all types of freight than rail due to safety restrictions.

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