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Logistics > Exam 2 > Flashcards

Exam 2 Flashcards

1
Q

While on the surface incoterms rules determine who pays what when, ultimately the __________ directly or indirectly pays the cost of transportation and international shipping

A

Importer

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2
Q

The choice of the incoterms rules is almost always the decision of the

A

Exporter

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3
Q

The choice of a proper incoterms rules is a critical decision because

A

ALL OF THE ABOVE
It can be an integral part of export strategy
It is linked to the level of customer service the firm is attempting to provide
It can be a competitive advantage

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4
Q

In terms of cost and responsibility the easiest incoterms rule for the exporter which is in turn the most difficult for the importer is

A

Ex-works (Exw)

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5
Q

The incoterms rule FCA means

A

Free carrier

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6
Q

FOB is

A

ALL OF THE ABOVE
free on board
An incoterms rule that can be used for any merchandise
An incoterms rule specifically designed for ocean transport

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7
Q

Under the incoterms rule FOB, responsibility for the cargo

A

Shifts from exporter to importer when the goods are loaded onto the ship in the country from which the goods are leaving

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8
Q

Incoterms rules determine

A

Which task will be preformed by the exporter

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9
Q

The incoterms rule EXW specifies what regarding delivery

A

It lets the exporter decide when the goods are delivered

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10
Q

The document that corresponds clearly to the transfer of responsibility for a free carrier shipment is the receipt given by the carrier to the exporter. This receipt can be

A

ALL OF THE ABOVE
a sea waybill
An air waybill
A multimodal bill of landing

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11
Q

The only incoterms rule which requires the importer to clear the merchandise for export from the country from which it is coming is

A

Ex-works

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12
Q

Under the free on board incoterms rule if a piece of cargo breaks loose while it is loaded onto the ship it becomes the responsibility of

A

The importer

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13
Q

Under the cost insurance and freight incoterms rules

A

The insurance must total at least 110 percent of the value of the goods

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14
Q

One of the differences between the delivered at terminal incoterms rule and the delivery at place incoterms rules

A

The unloading cost are borne by the exporter under dap and by the importer under dat

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15
Q

Delivered at place is an incoterms rule designed specifically form

A

It can be used by any means of transportation

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16
Q

The FOB term not only means free on board, it is also sometimes reffered to as

A

Freight on board

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17
Q

Under the delivery duty paid incoterms rule, unloading cost are borne by the

A

Importer

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18
Q

Which incoterms rule requires the exporter to pay the importer duty

A

DDP

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19
Q

In a quote which includes multiple incoterms rules, so that the customer can choose, the incoterms rule that has the highest invoiced amount is

A

DDP

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20
Q

Among the following, the most consumer friendly incoterms rule is

A

DAP

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21
Q

Certain countries do not allow importers to purchase insurance abroad. Which incorterms rule is therfore not available to importers located in these countries

A

CIP

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22
Q

The incoterm DAP specifies what regarding delivery

A

Who unloads the goods from the means of conveyance

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23
Q

As a revision in 2010, the only incoterm which requires the importer to clear the merchandise for export from the country from which it is coming is

A

Ex-works

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24
Q

Delivered at terminal is an incoterm designed specifically for

A

Containerized transportation

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25
Q

The risk that an exporter takes in requesting cash in advance as a means of payment is

A

It puts the exporter at a competitive disadvantage

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26
Q

An exporter can conduct its international business in a manner similar to the way it and most companies conduct domestic business by using

A

An open letter

27
Q

The importers bank is called the

A

Issuing bank

28
Q

The instruction letter is part of the documentary collection

A

In which the exporter, through the remitting bank, tells the present bank what it is expected to accomplish

29
Q

A standby letter of credit is similar to a simple letter of credit except for

A

It usually applies to more than one shipment from the exporter to the importer

30
Q

In valuing a currency the direct auote is

A

The value of the foreign currency expressed in units of the domestic currency

31
Q

Market based forecasting of exchange rates

A

ALL OF THE ABOVE
Is based on the premise that the market knows best
Attempts to capture the collective knowledge of sophisticated speculators in the future spot rate of a currency
Does not take into account government interaction

32
Q

A forward market hedge

A

ALL OF THE ABOVE
Allows a company to protect itself from currency fluctuations
May involve selling forward a future receivable in a foreign country
May involve purchasing forward the currency necessary to cover a foreign payment

33
Q

The risk resulting from possible fluctuations in currency exchange rates is called

A

Transaction exposure

34
Q

Stable countries representing the greatest percentage of the world trade all have ______ currencies

A

Floating

35
Q

Incoterms rules stands for

A

International commerce terms

36
Q

A typical container will be handled ______ times in each of the ports departure and destination

A

Four to six

37
Q

The biggest hazard for containerships is

A

Fire

38
Q

Most of the ships that sink each year

A

ALL OF THE ABOVE
are older ships
Are bulk ships
Are ships flying third world countries’ flags

39
Q

The part of the trip during which cargo is at most risk for theft is

A

The inland leg

40
Q

Marine cargo insurance can be purchased from

A

Freight forwarder

41
Q

Premiums in an open ocean cargo policy

A

Are based upon the value of shipments made under the policy

42
Q

A special cargo policy

A

ALL OF THE ABOVE
is an insurance policy that covers only one shipment
Allows a firm to purchase coverage that specifically fits a particular shipment
Results in cumbersome efforts to purchase insurance for each shipment

43
Q

A letter of credit usually requires

A

A certificate of insurance

44
Q

The liability of a single P&I club is limited to

A

$7 million

45
Q

Coverage a of the institute marine cargo clauses requires a special endorsement to cover

A

Strikes and other civil disturbances

46
Q

Coverage a of the institute of marine cargo clauses is the maximum coverage an exporter or importer would normally need to purchase

A

ALL OF THE ABOVE
for most trade lanes of the world
For shipments from one developed country to another
For shipments that stay away from politicsl hot spots of the world

47
Q

Goods shipped under deck

A

Are stowed inside the ship

48
Q

Institute for marine cargo clauses coverage b

A

ALL OF THE ABOVE
Is a named-perils policy
Includes coverage for goods washed overboard
Includes coverage for water damage and total losses during loading and unloading

49
Q

Under american conditions free of particular average policy

A

None of the above

50
Q

A sue and labor clause

A

Directs the shipper to act in the best interest of the insurance company when a loss occurs

51
Q

Airfreight insurance policies

A

Are written as all risk policies

52
Q

At lloyds the individuals assuming (insuring) risk are grouped together in

A

None of the above

53
Q

Ar lloyds the individuals assuming (insuring) risk have

A

Unlimited liability

54
Q

What kind of companies decide not to purchase insurance for international transportation risk?

A

Very large international traders with many shipments

55
Q

The united states export policy is mostly concerned about

A

Keeping some military technologies away from some countries

56
Q

A product not on the commerce control list or whose export control classification number does not call for an export license is classified as

A

None of the above

57
Q

The pro forma invoice

A

Must be written with extreme care to avoid discrepancies between the letter of credit and the commercial invoice

58
Q

The sentence this merchandise is licensed by the united states for ultimate destination [country]. Diversion country to US law prohibited is

A

None of the above

59
Q

Besides a contract and a receipt for goods an ocean bill of landing is

A

A certificate of title

60
Q

Deadweight tonnage

A

Is the maximum weight of cargo that a vessel can carry

61
Q

In contanerized shipping the term TEU stands for

A

Twenty foot equivalent unit

62
Q

Ships too large to pass through the panama canal are called

A

Post panamax ships

63
Q

Countires with an open registry often provide

A

Flags of convenience

64
Q

Break bulk ships

A

Can call at just about any port to pick up different kinds of cargo loads

Logistics (1 decks)

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