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Exam 14: Transportation in a Supply Chain

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Question 31

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Only safety inventory should be aggregated if low demand exists for low value items.

A) True
B) False

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Question 32

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Milk runs reduce inbound transportation costs by consolidating large shipments directly from the supplier to the consumer.

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B) False

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Question 33

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Which transportation network design option has the elimination of intermediate warehouses and its simplicity of operation and coordination as its major advantage?

Discuss the two key players involved in any transportation in the supply chain.

________ carriers are the preferred mode of transport for online businesses such as Amazon.com and Dell,as well as for companies such as W.W.Grainger and McMaster-Carr that send small packages to customers.

Transportation plays a key role in every supply chain because products are usually produced and consumed in the same location.

The mode of transportation that results in the lowest transportation cost will also lower total costs for a supply chain.

A carrier uses transportation to minimize the total cost (transportation,inventory,information,and facility)while providing an appropriate level of responsiveness to the customer.

The Mumbai dabbawalas have a transportation network that takes advantage of

A dabba uses the Mumbai railway system to carry about 40 lunches each day.

Scenario 14.1 - Vidalia Onions When Vidalia onions are ready,the entire 13 county (plus parts of seven other counties) area in Georgia where they are grown is devoted to the harvest,packaging and shipping of this delicacy.The Onion Shack currently purchases 120,000 bags of onions each year at a price of $100 per bag (a bag is ten pounds) .Onion Shack has historically purchased in lots of 3000 bags.Transit time and capacity vary as indicated in the table.The safety inventory that Onion Shack requires is 30% of lead time demand and the holding cost for a bag is 15% of cost. $\begin{array} { | l | c | c | c | c | } \hline \text { Carrier } & \begin{array} { c } \text { Quantity } \\\text { Shipped (cwt) }\end{array} & \begin{array} { c } \text { Quantity shipped } \\\text { (bags) }\end{array} & \begin{array} { c } \text { Shipping cost } \\\text { (\$/cwt) }\end{array} & \begin{array} { c } \text { Transit time } \\\text { (days) }\end{array} \\\hline \text { Mashburn Rail } & 200 + & 2000 + & \$ 2.10 & 5 \\\hline \text { Sylvia Express } & 100 + & 1000 + & \$ 2.35 & 3 \\\hline \text { Anita Enterprises } & 250 + & 2500 + & \$ 1.35 & 3 \\\hline \text { Smith Trucking } & 250 + & 2500 + & \$ 1.00 & 3 \\\hline\end{array}$ -Use Scenario 14.1 to determine the in-transit inventory cost of the Mashburn Rail option if the Onion Shack purchases 240,000 bags of Vidalia onions each year.

Which transportation network design is pictured?

The vehicle-related cost is incurred whether the vehicle is operating or not and is considered fixed for short-term operational decisions by the carrier.

Suppose that a highway is governed by a use fee charged to motorists that is based on congestion,operation and maintenance.The total traffic t is used to determine the cost of 5t2.What is the marginal cost?

The most important operational decision related to transportation in a supply chain is the routing and scheduling of deliveries.

Scenario 14.1 - Vidalia Onions When Vidalia onions are ready,the entire 13 county (plus parts of seven other counties) area in Georgia where they are grown is devoted to the harvest,packaging and shipping of this delicacy.The Onion Shack currently purchases 120,000 bags of onions each year at a price of $100 per bag (a bag is ten pounds) .Onion Shack has historically purchased in lots of 3000 bags.Transit time and capacity vary as indicated in the table.The safety inventory that Onion Shack requires is 30% of lead time demand and the holding cost for a bag is 15% of cost. $\begin{array} { | l | c | c | c | c | } \hline \text { Carrier } & \begin{array} { c } \text { Quantity } \\\text { Shipped (cwt) }\end{array} & \begin{array} { c } \text { Quantity shipped } \\\text { (bags) }\end{array} & \begin{array} { c } \text { Shipping cost } \\\text { (\$/cwt) }\end{array} & \begin{array} { c } \text { Transit time } \\\text { (days) }\end{array} \\\hline \text { Mashburn Rail } & 200 + & 2000 + & \$ 2.10 & 5 \\\hline \text { Sylvia Express } & 100 + & 1000 + & \$ 2.35 & 3 \\\hline \text { Anita Enterprises } & 250 + & 2500 + & \$ 1.35 & 3 \\\hline \text { Smith Trucking } & 250 + & 2500 + & \$ 1.00 & 3 \\\hline\end{array}$ -Use Scenario 14.1 to determine the transportation cost of the Anita Enterprises option if the Onion Shack purchases 240,000 bags of Vidalia onions each year.

It is best to disaggregate all inventories and use an inexpensive mode of transportation for replenishment when you have a

A shrewd supply chain manager would aggregate only safety inventory and use an inexpensive mode of transportation for replenishing cycle inventory if she is dealing with a

Investment decisions regarding the transportation infrastructure (rails,locomotives,trucks,airplanes,etc. ) are the primary concern of

Explain why transportation systems should be tailored.