What is the Purpose of Freight Classification,Describe the Difference Between a Rate and a Rating, How Do They Relate to Classification?

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Air transport is characterized by low fixed and high variable cost

 

STUDY QUESTIONS

1. Compare and contrast the transportation principles of economy of scales and economy of economy of scale and economy of distance. Illustrate how they combine to create an efficient transportation.

2. Railroads have the largest percentage of the intercity freight ton-miles, but motor carriers have the largest revenue. How do you explain this relationship?

3. What is the purpose of freight classification, describe the difference between a rate and a rating, how do they relate to classification?

 

Challenge question

1 What in your opinion will be the major impact of the Walmart decision to purchase FOB from its suppliers? The current stated objective is to reduce transportation costs on freight inbound to Walmart’s distribution centers.How might the business relationship, be impacted if at some future time Walmart decides to bypass its distribution centers and move merchandise direct from the suppliers to its retail stores?

 

TRUE OR FALSE

1. Motor carriers are the most used mode of transport.

TRUE/FALSE

2. The transportation mode having the fastest point to point transit time is truck.

TRUE/FALSE

3. Intermodal transportation typically consists of using three modes to complete a shipment.

TRUE/FALSE

4. The fact that most traditional carriers require a minimum charge helped create the market for package services.

TRUE/FALSE

5. Pipeline has the highest dependability and frequency among alternative modes.

TRUE/FALSE

6. Water transport has the highest fixed cost.

TRUE/FALSE

7. The land bridge combines sea and rail transport.

TRUE/FALSE

8.Under transportation regulation the government established rates.

TRUE/FALSE

9. Air transport is characterized by low fixed and high variable cost.

TRUE/FALSE

10. If your company does not want responsibility for freight damage, they should negotiate FOB destination rates.

TRUE/FALSE
 
 

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