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HW Chapter 15
Problem 15-1
Some manufacturing firms contract with an outside company to manage the firm’s logistics functions.
What is the general term for a firm that provides such services?
* Third-party logistics (3PL) company
Supply chain outsourcer
Lean logistics company
Lean supply chain provider
Contract logistics
These types of companies are called third-party logistics companies. UPS is one of the more visible
examples.
Problem 15-2
Logistics accounts for about what percent of the U.S. gross domestic product?
About 2-3 percent
*About 8-9 percent
About 19-20 percent
About 12 percent
About 5 percent
Exact figures will vary every year, but it is typically in the 8-9 percent range.
Problem 15-4
What mode of transportation is limited to specialized products such as liquids and gases?
Rail
*Pipelines
Waterway (ship)
Highway (truck)
Air
Due to their nature, pipelines are appropriate for shipping bulk liquid and gas products. Their main
advantages are speed of transport and low unit cost of shipping.
Problem 15-5
A manufacturer has decided to locate a new factory in northwestern United States to serve growing
demand in that market. They have narrowed the potential sites down to two finalists, City A and City
B. They have developed a list of important factors to consider in selecting a site, and rated each as
shown in the following table.
FACTOR
CITY A
CITY B
Utility rates
100
112
Availability of skilled labor
80
75
Tax rates
42
43
Transportation
46
38
Proximity to suppliers
35
34
Quality of life
20
16
Based on this data, which city appears to be the better choice?
City A
City B
They are equally attractive
There is insufficient information provided to answer this question
Explanation:
Summing up the factor ratings for each city shows that City A has an edge, 323 – 318, over City B.
City A is the better choice based solely on the data here.
Problem 15-6
Logistics Consultants Inc. (LCI) provides various logistics analysis services to other firms, including
facility location decisions. They have just completed a project for a major customer, but on the eve of
their presentation they discovered a computer malfunction had partially deleted some of their data.
One file that was impacted contains the final factor rating results. Following are the partial results
they were able to recover. As you’ll notice, some ratings are missing.
RATINGS
MAX POINTS
CITY X
CITY Y
150
131
123
130
124
110
80
73
Warehousing availability/costs
Proximity to customers
65
59
Business climate
Taxation structure
30
15
Quality of life
City Y
They are equally attractive