Chapter 1: Transportation: Critical Link in the Supply Chain
MULTIPLE CHOICE
1. Which of the following is not listed as one of the forces driving change in the economic
landscape?
a. technology
b. supply chain integration
c. consumer empowerment
d. scarcity of oil
ANS: D PTS: 1 DIF: Easy REF: Page 4
2. Why do retailers now have the power in the supply chain?
a. they are becoming manufacturers also
b. they represent the consumer
c. manufacturers have the power
d. they own their own logistics
ANS: B PTS: 1 DIF: Hard REF: Page 4
3. A key strategy that has enabled companies to successfully meet the demands of empowered
consumers is:
a. lower prices
b. better quality
c. collaboration
d. 24 hour service
ANS: C PTS: 1 DIF: Hard REF: Page 5
4. How much has passenger air travel increased between 1990 and 2006?
a. 170%
b. 110%
c. 70%
d. 200%
ANS: A PTS: 1 DIF: Hard REF: Page 9
5. How much has motor / air passenger mile split changed between 1990 and 2006?
a. The percentage of air increased 80%
b. The percentage of air decreased 80%
c. They remained unchanged
d. Not enough information to figure that out
ANS: A PTS: 1 DIF: Hard REF: Page 9
6. Which passenger mode of transportation had the greatest percentage increase in miles
between 1990 and 2006?
a. Air
b. Bus
c. Rail
d. Auto
ANS: A PTS: 1 DIF: Hard REF: Page 9
7. Which mode has seen the greatest increase in U.S. freight ton mile between 1990 and 2006?
a. Air
b. Truck
, c. Rail
d. Water
ANS: C PTS: 1 DIF: Hard REF: Page 9
8. Which mode of has lost volume of freight between 1990 and 2006?
a. Air
b. Pipeline
c. Rail
d. Water
ANS: D PTS: 1 DIF: Medium REF: Page 9
9. Please pick the correct formula for elasticity:
a. % change in quantity / change in price
b. price/quantity
c. % change in price / % change in quantity
d. % change in quantity / % change in price
ANS: D PTS: 1 DIF: Medium REF: Page 11
10. Landed cost is:
a. The fee associated with landing an aircraft at an airport
b. The total cost of a product to include the transportation cost of getting it to market
c. The cost of transportation
d. Port charges
ANS: B PTS: 1 DIF: Medium REF: Page 13
11. Which of the following is not listed as one of the value of service characteristics for
transportation?
a. Landed cost
b. Transit time
c. Insurance rate
d. Reliability
ANS: C PTS: 1 DIF: Medium REF: Pages 13-14
12. Reliability in transportation is defined as:
a. the ability to get the freight from a specific origin to a destination.
b. consistency of transit time
c. the ability to move specific types of freight
d. the ability to keep freight safe
ANS: B PTS: 1 DIF: Hard REF: Page 14
13. Which mode of transportation has had the greatest impact on the location of major cities?
a. Motor
b. Water
c. Rail
d. Pipeline
ANS: B PTS: 1 DIF: Easy REF: Page 16
14. When did senior manager begin to recognize the profit potential associated with proper
supply chain management?
a. 1910
b. 1980s
c. 1990s
, d. 2004
ANS: C PTS: 1 DIF: Easy REF: Page 17
15. One key reason for increasing importance of transportation from a supply chain perspective
is:
a. cost of gas
b. increased emphasis on global collaborative relationships and outsourcing
c. decrease in the amount of imports
d. green supply chain
ANS: B PTS: 1 DIF: Hard REF: Page 21
16. Which of the following is not one of the listed supply chain flows?
a. information
b. reverse logistics
c. financial
d. waste
ANS: D PTS: 1 DIF: Easy REF: Pages 22-23
17. One highly effective way to reduce the bull whip effect is to replace inventory with
a. transportation
b. information
c. on line ordering
d. closer manufacturing
ANS: B PTS: 1 DIF: Medium REF: Page 22
18. Which of the following is likely to have inelastic demand?
a. Ambulance service
b. Movie tickets
c. LCD televisions
d. Delivered pizza
ANS: A PTS: 1 DIF: Medium REF: Pages 10-11
19. Which of the following is likely to have elastic demand?
a. Gasoline
b. Fire department service
c. Starbucks coffee
d. Electricity
ANS: C PTS: 1 DIF: Easy REF: Pages 10-11
20. Which technology is used to locate specific trailer and even pallets?
a. RFID
b. GPS
c. ERP
d. GIS
ANS: A PTS: 1 DIF: Hard REF: Page 10
SHORT ANSWER
1. According to the book, what can be argued as the glue that holds the supply chain together?
ANS:
Transportation is considered the glue that hold the economy and the supply chain together.
PTS: 1 DIF: Medium REF: Page 4
, 2. Who has the power in the supply chain?
ANS:
The retail giants such as Walmart and Target.
PTS: 1 DIF: Easy REF: Page 4
3. The main source of consumer enlightenment is?
ANS:
Information from the Internet and media.
PTS: 1 DIF: Medium REF: Page 5
4. What invention has led to the growth of suburban areas?
ANS:
The automobile and roadway infrastructure.
PTS: 1 DIF: Medium REF: Page 8
5. One major impact of rising energy costs with respect to sourcing is?
ANS:
Companies are considering moving production closer to the customer market.
PTS: 1 DIF: Hard REF: Page 8
6. The early focus of logistics was?
ANS:
Physical distribution (outbound transportation)
PTS: 1 DIF: Easy REF: Page 17
ESSAY
1. Explain how technology has changed the economic landscape.
ANS:
Looking back who can not agree that in the last five years technology has changed they way
people live and interact, the Internet, facebook, twitter, and mobile computing, all widely in use.
Technology has had a similar dramatic impact on business. Technology has improved the
efficiency of business by things like converting to web-based business processes such as online
ordering. These online functions are much cheaper than having someone take an order over the
phone. Businesses have also become effective by implementing just-in-time arrangements. For
instance Dell’s JIT has resulted in people getting exactly what they want, tailored to their needs,
at no additional cost. Computers and the Internet provide increased capability and cheaper
information sharing. The connectivity of the Internet has allowed both small and large businesses
the ability to collaborate worldwide.
PTS: 1 DIF: Medium REF: Page 4
2. Explain how globalization has changed the economic landscape.
ANS:
Looking back to the mom and pop store of the 1970s, much has changed. Now products that are
assembled in one country may have parts that come from many other countries. The final product
is likely to be sold in still numerous other countries. In order to be more efficient business are
looking closely at what part of a product is their core competency, and for those other parts or
services these business are looking globally for lower cost and higher quality partners to supply
those non core parts. This has led to significant outsourcing and the transfer of many jobs around
the world. At the same time the consumer is provided with lower cost goods that are of higher
quality. Globalization means higher quality, more innovative products, and faster life cycles.
Globalization also means greater competitive pressure, more rapid change, and movement of
jobs.
PTS: 1 DIF: Medium REF: Page 4
MULTIPLE CHOICE
1. Which of the following is not listed as one of the forces driving change in the economic
landscape?
a. technology
b. supply chain integration
c. consumer empowerment
d. scarcity of oil
ANS: D PTS: 1 DIF: Easy REF: Page 4
2. Why do retailers now have the power in the supply chain?
a. they are becoming manufacturers also
b. they represent the consumer
c. manufacturers have the power
d. they own their own logistics
ANS: B PTS: 1 DIF: Hard REF: Page 4
3. A key strategy that has enabled companies to successfully meet the demands of empowered
consumers is:
a. lower prices
b. better quality
c. collaboration
d. 24 hour service
ANS: C PTS: 1 DIF: Hard REF: Page 5
4. How much has passenger air travel increased between 1990 and 2006?
a. 170%
b. 110%
c. 70%
d. 200%
ANS: A PTS: 1 DIF: Hard REF: Page 9
5. How much has motor / air passenger mile split changed between 1990 and 2006?
a. The percentage of air increased 80%
b. The percentage of air decreased 80%
c. They remained unchanged
d. Not enough information to figure that out
ANS: A PTS: 1 DIF: Hard REF: Page 9
6. Which passenger mode of transportation had the greatest percentage increase in miles
between 1990 and 2006?
a. Air
b. Bus
c. Rail
d. Auto
ANS: A PTS: 1 DIF: Hard REF: Page 9
7. Which mode has seen the greatest increase in U.S. freight ton mile between 1990 and 2006?
a. Air
b. Truck
, c. Rail
d. Water
ANS: C PTS: 1 DIF: Hard REF: Page 9
8. Which mode of has lost volume of freight between 1990 and 2006?
a. Air
b. Pipeline
c. Rail
d. Water
ANS: D PTS: 1 DIF: Medium REF: Page 9
9. Please pick the correct formula for elasticity:
a. % change in quantity / change in price
b. price/quantity
c. % change in price / % change in quantity
d. % change in quantity / % change in price
ANS: D PTS: 1 DIF: Medium REF: Page 11
10. Landed cost is:
a. The fee associated with landing an aircraft at an airport
b. The total cost of a product to include the transportation cost of getting it to market
c. The cost of transportation
d. Port charges
ANS: B PTS: 1 DIF: Medium REF: Page 13
11. Which of the following is not listed as one of the value of service characteristics for
transportation?
a. Landed cost
b. Transit time
c. Insurance rate
d. Reliability
ANS: C PTS: 1 DIF: Medium REF: Pages 13-14
12. Reliability in transportation is defined as:
a. the ability to get the freight from a specific origin to a destination.
b. consistency of transit time
c. the ability to move specific types of freight
d. the ability to keep freight safe
ANS: B PTS: 1 DIF: Hard REF: Page 14
13. Which mode of transportation has had the greatest impact on the location of major cities?
a. Motor
b. Water
c. Rail
d. Pipeline
ANS: B PTS: 1 DIF: Easy REF: Page 16
14. When did senior manager begin to recognize the profit potential associated with proper
supply chain management?
a. 1910
b. 1980s
c. 1990s
, d. 2004
ANS: C PTS: 1 DIF: Easy REF: Page 17
15. One key reason for increasing importance of transportation from a supply chain perspective
is:
a. cost of gas
b. increased emphasis on global collaborative relationships and outsourcing
c. decrease in the amount of imports
d. green supply chain
ANS: B PTS: 1 DIF: Hard REF: Page 21
16. Which of the following is not one of the listed supply chain flows?
a. information
b. reverse logistics
c. financial
d. waste
ANS: D PTS: 1 DIF: Easy REF: Pages 22-23
17. One highly effective way to reduce the bull whip effect is to replace inventory with
a. transportation
b. information
c. on line ordering
d. closer manufacturing
ANS: B PTS: 1 DIF: Medium REF: Page 22
18. Which of the following is likely to have inelastic demand?
a. Ambulance service
b. Movie tickets
c. LCD televisions
d. Delivered pizza
ANS: A PTS: 1 DIF: Medium REF: Pages 10-11
19. Which of the following is likely to have elastic demand?
a. Gasoline
b. Fire department service
c. Starbucks coffee
d. Electricity
ANS: C PTS: 1 DIF: Easy REF: Pages 10-11
20. Which technology is used to locate specific trailer and even pallets?
a. RFID
b. GPS
c. ERP
d. GIS
ANS: A PTS: 1 DIF: Hard REF: Page 10
SHORT ANSWER
1. According to the book, what can be argued as the glue that holds the supply chain together?
ANS:
Transportation is considered the glue that hold the economy and the supply chain together.
PTS: 1 DIF: Medium REF: Page 4
, 2. Who has the power in the supply chain?
ANS:
The retail giants such as Walmart and Target.
PTS: 1 DIF: Easy REF: Page 4
3. The main source of consumer enlightenment is?
ANS:
Information from the Internet and media.
PTS: 1 DIF: Medium REF: Page 5
4. What invention has led to the growth of suburban areas?
ANS:
The automobile and roadway infrastructure.
PTS: 1 DIF: Medium REF: Page 8
5. One major impact of rising energy costs with respect to sourcing is?
ANS:
Companies are considering moving production closer to the customer market.
PTS: 1 DIF: Hard REF: Page 8
6. The early focus of logistics was?
ANS:
Physical distribution (outbound transportation)
PTS: 1 DIF: Easy REF: Page 17
ESSAY
1. Explain how technology has changed the economic landscape.
ANS:
Looking back who can not agree that in the last five years technology has changed they way
people live and interact, the Internet, facebook, twitter, and mobile computing, all widely in use.
Technology has had a similar dramatic impact on business. Technology has improved the
efficiency of business by things like converting to web-based business processes such as online
ordering. These online functions are much cheaper than having someone take an order over the
phone. Businesses have also become effective by implementing just-in-time arrangements. For
instance Dell’s JIT has resulted in people getting exactly what they want, tailored to their needs,
at no additional cost. Computers and the Internet provide increased capability and cheaper
information sharing. The connectivity of the Internet has allowed both small and large businesses
the ability to collaborate worldwide.
PTS: 1 DIF: Medium REF: Page 4
2. Explain how globalization has changed the economic landscape.
ANS:
Looking back to the mom and pop store of the 1970s, much has changed. Now products that are
assembled in one country may have parts that come from many other countries. The final product
is likely to be sold in still numerous other countries. In order to be more efficient business are
looking closely at what part of a product is their core competency, and for those other parts or
services these business are looking globally for lower cost and higher quality partners to supply
those non core parts. This has led to significant outsourcing and the transfer of many jobs around
the world. At the same time the consumer is provided with lower cost goods that are of higher
quality. Globalization means higher quality, more innovative products, and faster life cycles.
Globalization also means greater competitive pressure, more rapid change, and movement of
jobs.
PTS: 1 DIF: Medium REF: Page 4
