CLP Transportation & Distribution 2 — Questions and Answers
Question 1: Which freight classification system is used in the US to determine LTL shipping rates?
- NMFC (National Motor Freight Classification) (Correct answer)
- IATA Commodity Classification
- Harmonized Tariff Schedule
- UCC-128 Standard
Correct answer: NMFC (National Motor Freight Classification)
The NMFC assigns freight classes 50–500 based on density, stowability, handling, and liability to determine LTL rates.
Question 2: A shipper contracts with a carrier for a guaranteed delivery time but the shipment arrives late, causing a production line shutdown. This loss is best described as:
- Consequential damages (Correct answer)
- Freight claim
- Cargo liability
- Force majeure
Correct answer: Consequential damages
Consequential damages are losses that result indirectly from a breach, such as production downtime caused by a late delivery.
Question 3: Which transportation mode offers the lowest cost per ton-mile for bulk commodities over long distances?
- Truck
- Rail (Correct answer)
- Air
- Pipeline
Correct answer: Rail
Rail provides the lowest cost per ton-mile for bulk shipments over long distances due to high capacity and fuel efficiency.
Question 4: The Carmack Amendment primarily governs carrier liability for:
- International ocean freight
- Domestic interstate rail and motor freight (Correct answer)
- Air cargo shipments
- Pipeline transportation
Correct answer: Domestic interstate rail and motor freight
The Carmack Amendment establishes carrier liability rules for loss or damage to goods shipped via interstate rail and motor freight in the US.
Question 5: A distribution center uses cross-docking to move product. Which best describes this practice?
- Storing goods in racked warehouses for weeks before outbound shipment
- Unloading inbound freight and transferring it directly to outbound vehicles with minimal storage (Correct answer)
- Consolidating small orders into full truckloads in a staging area
- Sorting returned goods for restocking or disposal
Correct answer: Unloading inbound freight and transferring it directly to outbound vehicles with minimal storage
Cross-docking transfers goods from inbound to outbound transport with little or no warehousing, reducing handling and storage costs.
Question 6: Which Incoterm places maximum responsibility on the seller, including delivery to the buyer's named destination with all duties paid?
- EXW (Ex Works)
- FOB (Free on Board)
- DDP (Delivered Duty Paid) (Correct answer)
- CIF (Cost, Insurance and Freight)
Correct answer: DDP (Delivered Duty Paid)
Under DDP, the seller is responsible for all costs and risks including import duties and delivery to the buyer's premises.
Question 7: A company consolidates multiple small LTL shipments into one FTL shipment to a regional hub. This strategy is called:
- Milk-run routing
- Pool distribution
- Zone skipping (Correct answer)
- Drop shipping
Correct answer: Zone skipping
Zone skipping bypasses intermediate carrier sort facilities by consolidating freight and injecting it closer to the final destination zone, reducing time and cost.
CLP Transportation & Distribution 2
Which freight classification system is used in the US to determine LTL shipping rates?