While Freight Rates Are Often Based on Very Complicated Pricing

question 26

Multiple Choice

While freight rates are often based on very complicated pricing systems, in general, the primary freight price factor is based on which of the following attributes?

• A) damage record
• B) on-time delivery
• C) door-to-door service
• D) speed of shipment
• E) consolidation capabilities

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Definitions:

Discount Factor(s)

A multiplier for determining the present value of future cash flows or other investments, reflecting the time value of money.

Simple Rate Of Return

A method to calculate the profitability of an investment by dividing the annual incremental net operating income by the initial investment cost.

Straight-Line Depreciation

A method of calculating the depreciation of an asset by evenly spreading its cost over its useful life.

Salvage Value

The estimated resale value of an asset at the end of its useful life, taken into consideration for depreciation calculations.