Shipping Market Supply and Demand Model
30 Questions
0 Views

Choose a study mode

Play Quiz
Study Flashcards
Spaced Repetition
Chat to lesson

Podcast

Play an AI-generated podcast conversation about this lesson

Questions and Answers

What is the starting point in the Shipping Market Supply/Demand Model?

  • Change in the performance of the fleet
  • The balance of supply and demand (correct)
  • Government decisions
  • Ordering new ships

    • How do changes in freight rates influence decision-making in the shipping market?

  • Increase government regulations
  • Improve fleet productivity
  • Prompt the ordering of new ships (correct)
  • Decrease transport costs

    • Which of the following is the most important influence on ship demand according to the text?

  • Political Events
  • Average Haul Shipbuilding production
  • The World Economy (correct)
  • Seaborne Commodity Fleet

    • What is the primary impact of the world economy on demand for sea transport?

    <p>Import of raw materials for manufacturing industry</p> Signup and view all the answers

    Which factor influences the way supply responds to changes in demand in the shipping market?

    <p>Freight Rate</p> Signup and view all the answers

    What may a change in freight rates lead to in the shipping market?

    <p>Prompt ordering of new ships and scrapping of old ones</p> Signup and view all the answers

    What represents the formula for Total Revenues (T.R)?

    <p>Quantity × Price</p> Signup and view all the answers

    What formula is used to calculate Average Variable Costs (A.V.C)?

    <p>Total Variable Cost ÷ Quantity of output</p> Signup and view all the answers

    What is the formula for Marginal Costs (MC)?

    <p>∆ Total Cost ÷ ∆ Quantity of output</p> Signup and view all the answers

    In shipping company management, what is a critical decision factor for success in the charter market?

    <p>Deciding when to buy or sell ships</p> Signup and view all the answers

    What aspect do shipowners need to consider to take advantage of shipping cycles?

    <p>Predicting peaks and troughs in freight rates</p> Signup and view all the answers

    What does a shipowner face when deciding whether to tie ships up in long-term time chartering or keep them available for spot market commitments?

    <p>The problem of choosing the right moment to make decisions</p> Signup and view all the answers

    Why is motor transport more suited than railways or water transport for sending goods rapidly?

    <p>Motor transport saves time in booking and taking delivery of goods.</p> Signup and view all the answers

    Why does motor transport have a cost advantage over railways?

    <p>Motor transport requires less initial capital investment.</p> Signup and view all the answers

    What advantage does road transport offer big businessmen according to the text?

    <p>Big businessmen can have their own motor vehicles and initiate their road services.</p> Signup and view all the answers

    In what way does road and motor transport act as a feeder to other modes of transport?

    <p>They begin and end the movement of goods using roads.</p> Signup and view all the answers

    What serious limitation of motor transport is highlighted in the text?

    <p>Roads become unfit and unsafe during rainy seasons.</p> Signup and view all the answers

    How does road transport save costs compared to other modes of transport according to the text?

    <p>By saving in packing costs and handling charges.</p> Signup and view all the answers

    What is fleet productivity in the shipping market model?

    <p>The efficiency with which ships are operated, such as speed and waiting time</p> Signup and view all the answers

    How is fleet productivity calculated?

    <p>By dividing the total ton miles of cargo shipments by the deadweight fleet actively employed</p> Signup and view all the answers

    What causes peaks and troughs in the market prospects of specific ship types?

    <p>Adjustments in shipbuilding output</p> Signup and view all the answers

    What is a characteristic of the shipbuilding industry according to the text?

    <p>Longcycle business due to delays between ordering and delivering ships</p> Signup and view all the answers

    What determines the rate of growth of the merchant fleet?

    <p>The balance between ship scrapping and new ship deliveries</p> Signup and view all the answers

    Which factor plays an active part in the fleet adjustment process in the shipping market model?

    <p>Shipbuilding industry output levels</p> Signup and view all the answers

    What might a change in freight rates prompt in the shipping industry?

    <p>Ordering of new ships and scrapping of old ones</p> Signup and view all the answers

    How does the world economy influence the demand for sea transport?

    <p>Through import of raw materials for manufacturing or trade in manufactured products</p> Signup and view all the answers

    What is an important cause of short-term volatility in the shipping industry?

    <p>Seasonality of some trades like agricultural commodities</p> Signup and view all the answers

    Which factor has the most significant impact on ship demand according to the text?

    <p>World economy</p> Signup and view all the answers

    What aspect of the world economy may bring about changes in the demand for sea transport?

    <p>The business cycle, trade elasticity, and trade development cycle</p> Signup and view all the answers

    Which influence is NOT mentioned as affecting the supply in the shipping market?

    <p>Political events</p> Signup and view all the answers

    Study Notes

    Shipping Market Supply/Demand Model

    • The starting point in the Shipping Market Supply/Demand Model is the intersection of the supply and demand curves.

    Freight Rates and Decision-Making

    • Changes in freight rates influence decision-making in the shipping market, affecting supply and demand.

    Ship Demand

    • The most important influence on ship demand is the world economy.
    • The primary impact of the world economy on demand for sea transport is the growth or decline of international trade.

    Supply Response

    • The factor that influences the way supply responds to changes in demand in the shipping market is the availability of ships.

    Freight Rate Impact

    • A change in freight rates may lead to changes in the supply and demand of ships, and ultimately affect the shipping industry.

    Revenue and Cost Formulas

    • The formula for Total Revenues (T.R) is not provided.
    • The formula for Average Variable Costs (A.V.C) is not provided.
    • The formula for Marginal Costs (MC) is not provided.

    Shipping Company Management

    • A critical decision factor for success in the charter market is the ability to anticipate and respond to changes in the market.

    Shipowners' Considerations

    • Shipowners need to consider the shipping cycles to take advantage of market opportunities.
    • When deciding whether to tie ships up in long-term time chartering or keep them available for spot market commitments, shipowners face a trade-off between stability and flexibility.

    Motor Transport

    • Motor transport is more suited than railways or water transport for sending goods rapidly due to its speed and flexibility.
    • Motor transport has a cost advantage over railways due to lower costs per unit of distance.
    • Road transport offers big businessmen the advantage of door-to-door delivery.
    • Road and motor transport act as a feeder to other modes of transport, providing the final leg of transportation.
    • A serious limitation of motor transport is its high dependence on fuel and vulnerability to fuel price changes.
    • Road transport saves costs compared to other modes of transport by reducing handling and storage costs.

    Fleet Productivity

    • Fleet productivity in the shipping market model is a measure of the efficiency of the fleet.
    • Fleet productivity is calculated by dividing the total amount of cargo carried by the total number of ships.

    Shipbuilding Industry

    • The shipbuilding industry is characterized by a cyclical nature, with peaks and troughs in the market prospects of specific ship types.
    • Peaks and troughs in the market prospects of specific ship types are caused by changes in demand and supply.

    Merchant Fleet

    • The rate of growth of the merchant fleet is determined by the balance between new ship deliveries and ship scrapping.
    • The fleet adjustment process in the shipping market model is influenced by the availability of new ships and the scrapping of old ships.

    Freight Rate Impact

    • A change in freight rates may prompt changes in the shipping industry, such as changes in supply and demand.

    World Economy and Demand

    • The world economy influences the demand for sea transport, with changes in international trade affecting the demand for ships.
    • Short-term volatility in the shipping industry is caused by changes in the world economy.

    Ship Demand

    • The most significant impact on ship demand is the world economy.
    • Changes in the world economy, such as changes in international trade, may bring about changes in the demand for sea transport.

    Supply Influences

    • The availability of ships is not mentioned as an influence on the supply in the shipping market.

    Studying That Suits You

    Use AI to generate personalized quizzes and flashcards to suit your learning preferences.

    Quiz Team

    Description

    Learn about the Shipping Market Supply and Demand Model, which involves balancing supply and demand in the shipping industry. Understand how changes in world economy, political conditions, and market dynamics impact freight rates and decision-making for shipowners and governments.

    More Like This

    Marine Fuel Market Shift
    20 questions

    Marine Fuel Market Shift

    HumourousRapture avatar
    HumourousRapture
    Maritime Supply Chain Actors
    10 questions

    Maritime Supply Chain Actors

    RazorSharpBoston avatar
    RazorSharpBoston
    Understanding the Shipping Market and Logistics Actors
    14 questions

    Understanding the Shipping Market and Logistics Actors

    InstrumentalPiccolo avatar
    InstrumentalPiccolo
    Use Quizgecko on...
    Browser
    Open
    Browser
    Browser