Transportation: A Global Supply Chain Perspective 9th Edition by Robert A. Novack Test bank

an advantage in producing one of two products in terms of cost. Absolute advantage recommends
that they each produce the one product where they have the advantage and then trade which will be
mutually beneficial. Whereas comparative advantage postulates that even if one country or region
has a low cost advantage for both products, trade can be beneficial if the low cost country has a
comparative advantage in one of the products
POINTS: 1
DIFFICULTY: Hard
REFERENCES: Page 11
QUESTION TYPE: Essay
HAS VARIABLES: False
DATE CREATED: 8/8/2015 2:58 AM
DATE MODIFIED: 8/13/2015 1:03 AM
33. What other demographics in addition to the size of a country’s population are important for economic growth?
ANSWER: In addition to size, education levels and skills are important indicators of labor efficiency. The age
distribution of the country’s population is also important. A younger population usually means a
larger labor pool and more potential for families and market demand. The general health of citizens
and average life span are of interest.
POINTS: 1
DIFFICULTY: Medium
REFERENCES: Page 13
QUESTION TYPE: Essay
HAS VARIABLES: False
DATE CREATED: 8/8/2015 2:59 AM
DATE MODIFIED: 8/13/2015 1:03 AM
34. What is a megacity and why are they important for the future?
ANSWER: The term megacity is relatively new and used to describe urban areas with populations over ten
Chapter 01: Global Supply Chains: The Role and Importance of Transportation
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million. They represent a worldwide trend of populations migrating to urban areas. In developing
nations, they will present major challenges to develop the infrastructure, transportation, and utilities
to adequately support the population.
POINTS: 1
DIFFICULTY: Medium
REFERENCES: Page 13
QUESTION TYPE: Essay
HAS VARIABLES: False
DATE CREATED: 8/8/2015 3:00 AM
DATE MODIFIED: 8/13/2015 1:03 AM
35. Why was information technology so impactful for businesses and other organizations?
ANSWER: Information technology has been a major factor for increasing competition, changing business
models and the obsolescence of some business. It has expedited outsourcing strategies and provided
an opportunity for businesses, large or small, to participate in supply chains over a wider
geographic area. Information has afforded opportunity and also disruption and the end is not
insight.
POINTS: 1
DIFFICULTY: Medium
REFERENCES: Page 17
QUESTION TYPE: Essay
HAS VARIABLES: False
DATE CREATED: 8/8/2015 3:02 AM
DATE MODIFIED: 8/13/2015 1:03 AM
36. What impact has robotics had on supply chains?
ANSWER: The skills of humans combined with the precision and efficiency of robots has led to improved
productivity in distribution centers where the robots store, retrieve and pack goods for distribution.
More is yet to come!
POINTS: 1
DIFFICULTY: Medium
REFERENCES: Page 17
QUESTION TYPE: Essay
HAS VARIABLES: False
DATE CREATED: 8/8/2015 3:05 AM
DATE MODIFIED: 8/13/2015 1:03 AM
37. Why has P&G decided to jettison about half of their brands?
ANSWER: Like many large consumer product companies, P&G added new brands/products to increase gross
sales, but over time in the more competitive global environment, the large number of brands
become a disadvantage and about half of the brands produced “marginal” sales. They also lost some
of their flexibility and responsiveness to respond to changes in the marketplace to remain
competitive.
POINTS: 1
DIFFICULTY: Hard
REFERENCES: Page 20
Chapter 01: Global Supply Chains: The Role and Importance of Transportation
Copyright Cengage Learning. Powered by Cognero.  Page 13
QUESTION TYPE: Essay
HAS VARIABLES: False
DATE CREATED: 8/8/2015 3:05 AM
DATE MODIFIED: 8/13/2015 1:03 AM
38. Explain the three major flows in a supply chain.
ANSWER: They are: product flow, information flow, and financial/cash flow. Product flow is a traditional area
of importantance for logistics to acquire, make and distribute finished products in an efficiently and
timely manner. You can think of it as the supply chain engine. Information flow is the fuel of the
supply chain powering materials and products through the chain from beginning to end. The
financial cash flow is the payback for accomplishing the objectives of the supply chain efficiently
and effectively. 
POINTS: 1
DIFFICULTY: Hard
REFERENCES: Page 23
QUESTION TYPE: Essay
HAS VARIABLES: False
DATE CREATED: 8/8/2015 3:07 AM
DATE MODIFIED: 8/13/2015 1:03 AM
39. What is the bullwhip effect and why is it important?
ANSWER: When there is uncertainty about demand and long intervals between information flows, inventory