Q&A Hero

Q: How important, if at all, is it for N.A.M. to ship via water to show its support of the European Union's Motorways of the Seas concept?

Q: Would you make the same routing recommendation for the second, larger (199 buses) component of the order, after the initial 90-day deadline is met? Why or why not?

Q: The Brazilian buyer wants the buses delivered at Santos. Weiss looks up the International Chamber of Commerce's Incoterms and finds three categories of "delivered" at a receiving port. They are: DAT (Delivered at Terminal). In this type of transaction, the seller clears the goods for export and bears all risks and costs associated with delivering the goods and unloading them at the terminal at the named port or place of destination. The buyer is responsible for all costs and risks from this point forward including clearing the goods for import at the named country of destination. DAP (Delivered at Place). The seller clears the goods for export and bears all risks and costs associated with delivering goods to the named place of destination not unloaded. The buyer is responsible for all costs and risks associated with unloading the goods and clearing customs to import goods into the named country of destination. DDP (Delivered Duty Paid). The seller bears all risks and costs associated with delivering the goods to the named place of destination ready for unloading and clearing for import. How should he choose? Why?

Q: What kinds of "customer service" support must be provided for this initial shipment of 25 buses? Who is responsible?

Q: How important, in fact, are the transport costs for the initial shipment of 25 buses?

Q: What additional information would be helpful for answering Question 2?

Q: Which of the routing alternatives would you recommend to meet the initial 90-day deadline for the 25-bus shipment? Train or waterway? To which port(s)? What would it cost?

Q: Assume that you are Weiss. How many viable alternatives do you have to consider regarding the initial shipment of 25 buses?

Q: The Logistics Performance was created in recognition of the importance of logistics in international trade.

Q: Germany ranked first in overall performance in the most recent Logistics Performance Index.

Q: Inventory valuation on an international scale is difficult because of continually changing exchange rates.

Q: Because greater uncertainties, misunderstandings, and delays often arise in international movements, safety stocks must be larger.

Q: Drayage refers to ocean shipping, often along a region's coast, rather than across oceans.

Q: Some countries conduct inspections of trucks as they move from one state to another.

Q: China ranks first in the world in terms of highway mileage.

Q: Bilateral agreements liberalize international aviation opportunities and limit federal government involvement.

Q: Integrated air carriers own all their vehicles and the facilities that fall in between.

Q: Ocean carrier alliances provide two primary benefits to participating members, namely, the sharing of vessel space and lower rates.

Q: Shipping conferences refer to annual meetings of large international shippers.

Q: Load centers refer to major ports where thousands of containers arrive and depart each week.

Q: In terms of container throughput, Shanghai is the world's busiest container port.

Q: Approximately 75% of cross-border shipments move by water transportation.

Q: International transportation cannot be effective or efficient without fairly identical handling equipment being in place at each end of the trip.

Q: Export packers custom pack shipments when the exporter lacks the equipment or expertise to do so itself.

Q: Export trading companies act as the export sales department for a manufacturer.

Q: From a shipper's perspective, a non-vessel operating common carrier (NVOCC) is a carrier; from an ocean carrier's perspective, an NVOCC is a shipper.

Q: International freight forwarders' income comes from two primary sources.

Q: Consular documents involve obtaining permission from the importing country for goods to enter.

Q: An open account is of minimal risk to the seller and extremely risky to the buyer.

Q: Four distinct international methods of payment (e.g., letters of credit) exist.

Q: The use of Incoterms is mandatory for international shipments.

Q: Incoterms 2010 now divides terms of sale into two groups, one of which applies to any mode of transport and the other which applies to sea and inland water transport only.

Q: Some free trade agreements have actually resulted in an increase in documentation requirements.

Q: A shipper's letter of instruction contains relevant export transaction data such as the transportation mode(s), transaction participants, and description of what is being exported.

Q: A certificate of origin specifies the country (ies) in which a product is manufactured.

Q: The documentation requirements for international shipments can act as a nontariff barrier to trade.

Q: National holidays have no impact on the effectiveness and efficiency of international logistics.

Q: It might not be unusual for cargo handlers in some countries to be illiterate.

Q: Albania and Montenegro are currently candidates to be admitted to the European Union.

Q: Sachets (single-use packets) require different packaging and are easier to lose and more prone to theft than products sold in larger quantities.

Q: When one country's currency is weak relative to other currencies, it is more costly to import products into that country.

Q: Cargo preference rules indicate how each shipment should be loaded into a transport vehicle.

Q: Some nations with weak balance-of-payment positions issue an import license on the condition that the goods move on an aircraft or vessel flying that nation's flag.

Q: Embargoes are physical limits on the amount that may be imported from any one country during a period of time.

Q: The primary purpose of a nontariff barrier is to encourage exports.

Q: Tariffs refer to taxes that governments place on the importation of certain items.

Q: The ratio of merchandise exports to gross world product is currently approximately 20%.

Q: Gross world product refers to the sum of the gross domestic product of all countries.

Q: The Logistics Performance Index ____. a. was created in recognition of the importance of logistics in international trade b. measures a company's logistics cost as a percentage of its total cost c. compares inventory turnover for major retailers d. applies the Balanced Scorecard approach to international logistics activities

Q: Which of the following statements about international inventory management is false? a. product return policies are a concern b. inventory valuation is difficult because of continually changing exchange rates c. safety stocks generally need to be larger d. inventory for sale in one nation generally serves the needs of markets in nearby nations e. all of the above are true

Q: Short-sea shipping is widely accepted and practiced in ____. a. North America b. South America c. Europe d. Asia

Q: Which of the following statements is false? a. in China, freight is often given lower priority than passengers in rail transportation b. China ranks first in the world in terms of highway mileage c. highway freight transportation can be provided by animals and carts in some countries d. some countries limit a motor carrier's operations to within a particular state's borders e. all of the above are true

Q: Which countries rank first, second, and third, respectively in terms of highway mileage? a. United States, China, India b. China, India, United States c. China, United States, India d. Russia, United States, China

Q: Which of the following is not open for negotiation in a bilateral air agreement? a. the carriers that will service particular city pairs b. the types of aircraft to be used c. the number of flights between the two countries d. the total number of seats to be offered e. all of the above are open for negotiation

Q: Integrated air carriers ____. a. perform transportation in tightly linked supply chains b. are those that own several modes of transportation c. utilize the services of scheduled airlines d. own all their vehicles as well as pick up and delivery facilities

Q: Ocean carrier alliances provide two primary benefits to participating members, namely, the sharing of vessel space and ____. a. anti-trust immunity b. the ability to offer shippers a broader service network c. lower rates d. faster transit times e. none of the above

Q: Shipping conferences refer to ____. a. annual meetings of large international shippers b. international shippers' associations c. cartels of ocean vessel operators operating between certain trade areas d. water ports that are located in the same geographic area

Q: ____ refer to major ports where thousands of containers arrive and depart each week. a. load centers b. break-bulk centers c. consolidation points d. hubs

Q: As of 2012, ____ is the world's busiest container port. a. Singapore b. Shanghai c. Hong Kong d. Shenzhen

Q: Approximately ____ of cross-border shipments move by water transportation. a. 40% b. 50% c. 60% d. 70%

Q: The cost of sending a shipment by air transportation from China to the United States can be ____ times more expensive than sending a shipment by water transportation between the two countries. a. 2-4 b. 4-6 c. 6-8 d. 8-10

Q: An ____ custom packs shipments when the exporter lacks the equipment or the expertise to do so itself a. export management company b. export trading company c. international freight forwarder d. export packer e. none of the above

Q: ____ act the export sales department for a manufacturer. a. international freight forwarders b. shippers associations c. export management companies d. export trading companies

Q: Which international logistics service provider is often confused with the international freight forwarder? a. customshouse broker b. non-vessel operating common carrier c. export management company d. export trading company

Q: Which of the following is not a source of income for international freight forwarders? a. payment for freight pick up and delivery b. buying space wholesale and selling it retail c. commissions on shipping revenues generated for carriers d. fees for document preparation and performing research d. all of the above are sources of income

Q: Consular documents ____. a. involve obtaining permission from the importing country for the goods to enter b. must be filed for every export shipment c. can be used in place of a shipper's export declaration d. list the shipper, consignee, commodity (ies), and place of export e. none of the above

Q: International freight forwarders can provide a number of functions. Which of the following is not one of them? a. booking space on carriers b. preparing an export declaration c. arranged for insurance d. preparing and sending shipping notices and documents e. all of the above are possible functions

Q: What international method of payment is issued by a bank and guarantees payment to a seller provided that the seller has complied with applicable terms and conditions of the particular transaction? a. a bill of exchange b. a letter of credit c. forfaiting d. an open account

Q: ____ distinct international methods of payment exist. a. 10 b. 8 c. 6 d. 4 e. none of the above

Q: Incoterms are generally revised approximately every ____ years. a. 25 b. 20 c. 10 d. 5

Q: Incoterms refer to ____. a. standardized procedures for handling international shipments b. standardized international trade terminology c. a specific method of payment for international shipments d. terms of sale for international shipments

Q: A ____ often serves as the basis for a country's official export statistics. a. shipper's export declaration b. carnet c. certificate of origin d. commercial invoice

Q: A ____ is similar in nature to a domestic bill of lading and summarizes the entire transaction. a. certificate of origin b. commercial invoice c. shipper's letter of instruction d. shipper's export declaration e. none of the above

Q: A ____ specifies the country (ies) in which a product is manufactured and can be required by governments for control purposes or by an exporter to verify the location of manufacture. a. commercial invoice b. waybill c. certificate of origin d. shipper's export declaration

Q: Which of the following is not a cultural factor that can influence international logistics? a. language b. time orientation c. population d. national holidays e. all of the above are cultural factors

Q: A ____ is used in areas where dockworkers cannot read but need a method to keep documents and shipments together. a. RFID tab b. shipper's mark c. shipment coordinator d. bar code

Q: Which of the following is not true of sachets? a. they can be easier to lose b. they are more prone to theft c. different packaging is needed d. they tend to be sold in higher-income countries e. all of the above are true

Q: When one country's currency is weak relative to other currencies, ____. a. it becomes more costly to import products to the country, but its exports surge b. both imports and exports surge c. it becomes more costly to export products from the country, but its imports surge d. it becomes more costly to import and export products

Q: Cargo preference rules ____. a. are synonymous with embargoes b. indicate how each shipment should be loaded into a transport vehicle c. indicate a shipper's preferred carrier(s) d. require a certain percentage of traffic to move on a nation's flag vessels e. none of the above

Q: What do we call a system of accounts that records a country's international financial transactions? a. tariffs b. balance of payments c. import / export accounts d. gross domestic product