Exam 1

Question 1

Exports

Answer 1

Goods and Services produced domestically and sold abroad

Question 2

Imports

Answer 2

Goods and Services produced abroad and sold domestically

Question 3

Net Exports

Answer 3

Value of a nation’s exports; minus the value of its imports. (Same as Trade Balance)

Question 4

Trade Balance

Answer 4

Value of a nation’s exports; minus the value of its imports. (Same as Net Exports)

Question 5

Trade Surplus

Answer 5

Excess exports over imports

Question 6

Trade Deficit

Answer 6

Excess of imports over exports

Question 7

Balance Trade

Answer 7

Exports equal imports

Question 8

Factors that can influence countries’ exports

Answer 8

Price of goods, exchange rates, the income of the citizens, Cost of transport, and policies made by the government.

Question 9

Absolute Advantage

Answer 9

Being more efficient than other countries when it comes to producing a certain product.

Question 10

Comparative Advantage

Answer 10

The difference in the cost of producing products in different countries. (Gains from trade arise)

Question 11

Opportunity Cost

Answer 11

Whatever must be given up to obtain some item.

Question 12

Global Flows and Trades contributing factors

Answer 12

Population, Urbanization, Land and Resources, Technology and Info, and Globalization

Question 13

Technology and Info

Answer 13

Technology can be an internal or external driver of change. (Software inside of a business- internal) (New business models- external) Internet and robots are also other factors of technology

Question 14

Basic Characteristics of Supply Chain

Answer 14

Three key flows: Products and related services, Information, and Financial (cash).

Question 15

Product Flow

Answer 15

Dependent on effective transportation for all products delivered to customers.

Question 16

Information Flow

Answer 16

Demand or sales data is responded by logistics to respond to customer’s orders.

Question 17

Bull Whip Effect

Answer 17

Increasing swings in inventory in response to shifts in consumer demand for a product. (accurate information flows can help mitigate the bullwhip effect)

Question 18

Financial Flow

Answer 18

Involves all flows of payment for goods, services, and orders.

Question 19

Transportation Demand

Answer 19

A request to move a given weight or amount of cargo a specific distance between two specific points. (Measured in ton-miles) CWT

Question 20

Economic Significance with Transport

Answer 20

Workforce mobility, growth of suburban areas, increased land and property values, and tourism.

Question 21

Passenger Mile

Answer 21

Moving People. (One passenger moving 500 miles or 500 people going one mile, either one is 500 passenger miles)

Question 22

Ton Mile

Answer 22

Moving Freight (500 tons for 1 mile, 100 tons for 5 miles, 1 ton for 500 miles; all are considered 500 ton-miles) CWT

Question 23

Modal Split

Answer 23

A tool used to help divide passenger and freight movements according to use and by volume.

Question 24

Modal Split (passenger miles)

Answer 24

The highway makes up 86% of transportation, Rail is 1%, Transit is 1%, and Air is 12%.

Question 25

Modal Split (Weight)

Answer 25

Trucks make up 67%, Rail is 10%, Water is 5%, Air is 0.08%, Mail is 8%, Pipeline is 8%, and the other 2% is other.

Question 26

Demand Elasticity

Answer 26

Elastic means price-sensitive and inelastic means that it isn't price-sensitive.

Question 27

Landed Costs

Answer 27

The total cost of landed shipment including purchasing price, freight, insurance, and other costs up to to the port.

Question 28

Landed Cost (continued)

Answer 28

``` Landed Cost - LC(P) = LC(S) $50 + $0.60(x) = $50 + $0.50(200 – x) $0.60(x) + $0.50(x) = $50 + $100 - $50 $1.10(x) = $100 x = 90.9 miles from P ```

Question 29

Landed Cost (continued)

Answer 29

``` Landed Cost - LC(P) = LC(S) $50 + $0.60(x) = $50 + $0.50(200 – x) $0.60(x) + $0.50(x) = $50 + $100 - $50 $1.10(x) = $100 x = 90.9 miles from P ```

Question 30

Good Figures

Answer 30

See Chapter 2; Slides 23 and 24

Question 31

Time Utility

Answer 31

Enhancing a product's marketability by making it available at a convenient time

Question 32

Place Utility

Answer 32

Where the product or service is made available

Question 33

Quantity Utility

Answer 33

Goods arrive without damage and are the correct quantity ordered.

Question 34

Economies of Scale

Answer 34

Cost advantages that companies obtain due to size, output, or scale of operation.

Question 35

Land Value

Answer 35

Transportation improvements that enhance an area's economy can also increase the value of the land that is served or is adjacent to the area of improvement.

Question 36

Good Figures (2)

Answer 36

Chapter 2; Slide 31

Question 37

Downsides of some Transportation

Answer 37

Noise, Safety, Pollution, Regulations.

Question 38

Rate

Answer 38

The amount that can be found on a published tariff rate sheet

Question 39

Price

Answer 39

Denotes more flexibility because of competition

Question 40

Monopoly

Answer 40

Low number of sellers and low demand elasticity

Question 41

Marginal Cost (MC)

Answer 41

The increase in Total Cost from producing one more unit. MC = TC/Q

Question 42

Headhaul

Answer 42

The first half of a round trip. Origin to destination

Question 43

Backhaul

Answer 43

Return trip. Destination back to origin

Question 44

Class Rate

Answer 44

Provides a rate for any commodity between two points | Trillion of different rate options

Question 45

Exception Rate

Answer 45

Rates that are designed to allow carriers in a particular region to depart from the class rate

Question 46

Commodity Rate

Answer 46

Rate on commodities for specific origin – destination for specific commodities

Question 47

Simplify Quotes By;

Answer 47

Geographic Location, Commodity, and Rate Structure.

Question 48

Base Point

Answer 48

Major shipping points in defined areas

Question 49

Rate Basis Number

Answer 49

Distance between any two base points

Question 50

Executive Branch

Answer 50

Establishes Policy... U.S. Department of Transportation, Department of State,

Question 51

Intrastate vs Interstate

Answer 51

Interstate - Federal Regulation (jumps state lines) | Intrastate - State Regulation (Stays within state lines)

Question 52

Common law

Answer 52

Law developed from Prior Court Decisions

Question 53

Civil Law or Statutory

Answer 53

Enacted by legislative bodies

Question 54

Anti-Trust Laws

Answer 54

Ensures fair competition

Question 55

Per se violation

Answer 55

Illegal regardless of whether economic harm occurs

Question 56

Rule of Reason Violation

Answer 56

Economic harm to parties must be shown

Question 57

Nationalization

Answer 57

Government taking ownership of a company or industry

Question 58

Privatization

Answer 58

Opposite of nationalization

Question 59

Benefit/Cost Ratio

Answer 59

Net Benefits over project lifetime / Sum of initial project costs