Chapter 6 Quiz Flashcards
When a company chooses not to purchase insurance for goods in transit, what are they practicing?
a. risk minimization
b. risk retention
c. risk redistribution
d. risk management
b. risk retention
T or F: When an incoterm includes the letter “I” it stands for intermodal transportation.
False; stands for insurance
Which incoterms group has the seller responsible for preparing the goods and delivering them to the port of export, while the buyer is responsible for paying the main carriage, delivering the goods to the port of import, and final delivery?
a. Group E
b. Group F
c. Group D
d. Group C
b. Group F
T or F: In the case of a shipping catastrophe at sea, a freight owner is responsible for his own goods and may also have the potential liability toward goods or equipment owned by other organizations.
True
This INCOTERM maximizes the effort, risk, and costs for the seller (that is, the exporter):
a. “F” terms- ready for delivery
b. “D” terms- delivered
c. “C” terms- transport cost
d. “E” terms- ex works
b. “D” terms- delivered
Match the international shipping document with the most appropriate description:
a. a bill for the goods from the seller to the buyer that describes the transaction from start to finish.
b. issued by the transportation carrier to the exporter acknowledging that shipment has been received and placed on board the vessel
c. escrow-like agreement between buyers’ and sellers’ bank which guarantees payment if seller meets specified terms of the sale
d. assures the coverage of freight loss or damage during transit
a. Commercial Invoice
b. Bill of Lading
c. Letters of Credit
d. Insurance Certificate
What is the advantage of truck over rail for the final port-to-customer segment of the international delivery?
a. lower delivery cost per shipment
b. greater service quality variance
c. greater destination accessibility
d. greater carrying capacity
c. greater destination accessibility
T or F: With indirect transportation service, transportation is interrupted by interim stops and transfers of freight between modes.
True
When choosing a mode of transportation for international freight, you should consider all of the following EXCEPT:
a. customs liquidation
b. freight rates
c. transit time
d. routing options
a. customs liquidation
After an import shipment has been successfully reviewed by customs and correct payments have been made for the duties, ________ occurs and the goods are ready to be moved to the final destination.
a. import entry
b. classification of the shipment
c. valuation of each unit
d. release to the importer
d. release to the importer
What type of tariff system is used when U.S. Customs bases the import duties and on the value of the goods?
a. quantity based tariffs
b. seasonal tariffs
c. entry tariffs
d. ad-valorem tariff
d. ad-valorem tariff
It is the __________ responsibility to ensure that their goods meet admissibility requirements such as proper marking or labeling, packaging, or safety standards and to obtain proper permits, certificates and licenses before the goods arrive in the U.S.:
a. freight forwarder’s
b. exporter’s
c. importer’s
d. carrier’s
c. importer’s
