CTP Transportation Economics & Rate Structures 3

Question 1

In freight classification, 'density' is calculated as weight divided by volume. Why is higher-density freight generally assigned a lower freight class?

Accepted Answer

Higher density means more weight per cubic foot, making better use of trailer space and lowering carrier cost per pound

Answer

Denser freight is always less fragile and therefore cheaper to insure

Answer

Lower freight classes are reserved by regulation for commodities over 50 lbs/cu ft

Answer

Carriers prefer dense freight because it qualifies for government freight subsidies

Question 2

Which pricing strategy involves charging different rates to different customers for an identical transportation service based on their demand characteristics?

Accepted Answer

Price discrimination

Answer

Uniform rate pricing

Answer

Cost-plus pricing

Answer

Penetration pricing

Question 3

In transportation economics, the 'headhaul' lane in a trade lane refers to:

Accepted Answer

The dominant, high-demand direction of freight flow where capacity is tight and rates are higher

Answer

The shortest possible routing between origin and destination

Answer

The first leg of a multi-stop delivery route

Answer

The primary lane used by household goods movers

Question 4

Which of the following is an example of an 'accessorial charge' on a freight invoice?

Accepted Answer

A liftgate delivery fee charged when no dock is available at destination

Answer

The base line-haul rate per hundredweight

Answer

The fuel surcharge index percentage

Answer

The shipper's negotiated discount off class rates

Question 5

What was the primary purpose of freight rate bureaus before transportation deregulation in the U.S.?

Accepted Answer

To allow competing carriers to collectively set and publish tariff rates under antitrust immunity

Answer

To inspect freight for safety compliance before interstate shipment

Answer

To negotiate shipper contracts on behalf of small transportation companies

Answer

To audit carrier financial statements and certify solvency to the ICC

Question 6

In carrier cost analysis, 'line-haul cost' refers to:

Accepted Answer

The cost directly associated with moving freight between origin and destination, primarily driver wages and fuel

Answer

The cost of maintaining terminal facilities along a route

Answer

The administrative cost of processing freight bills and invoices

Answer

The cost of equipment depreciation allocated to a fiscal year

Question 7

Which U.S. federal agency currently has primary jurisdiction over surface transportation economic regulation, including railroad rate disputes?

Accepted Answer

Surface Transportation Board (STB)

Answer

Federal Motor Carrier Safety Administration (FMCSA)

Answer

Department of Transportation Office of the Secretary (OST)

Answer

Federal Highway Administration (FHWA)