Asked by Rebika Basnet on May 11, 2024

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What is often the largest component of logistics costs?

A) Inventory costs
B) Transportation costs
C) Shipper-related costs
D) Administrative costs

Logistics Costs

The total expenses incurred in moving goods from their point of origin to the final consumer, including transportation, warehousing, and handling fees.

Inventory Costs

The costs associated with storing and handling inventory, including warehousing, insurance, and transportation, among others.

Transportation Costs

Expenses associated with moving goods from one location to another, including fuel, labor, and maintenance of vehicles, among other factors.

  • Recognize the trade-offs and decision-making process in logistics to optimize total logistics costs.
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Verified Answer

AM
Austin MurrayMay 17, 2024
Final Answer :
B
Explanation :
Transportation costs are often the largest component of logistics costs, as they can account for a significant portion of the total cost of moving goods from one location to another. Inventory costs can also be significant, but they are often more variable and dependent on factors such as order size and frequency. Shipper-related costs and administrative costs can also add to logistics expenses, but they are typically less significant than transportation and inventory costs.