A first principles study of the dynamics of 6 Li( 2 S)+ 6 Li 174 Yb( 2 Σ + )→ 6 Li2( 1 Σ + )+ 174 Yb( 1 S) reaction is presented at cold and ultracold temperatures. The computations involve determination and analytic fitting of a three-dimensional potential energy surface for the Li2Yb system and quantum dynamics calculations of varying complexities, ranging from exact quantum dynamics within the close-coupling scheme, to statistical quantum treatment, and universal models. It is demonstrated that the two simplified methods yield zero-temperature limiting reaction rate coefficients in reasonable agreement with the full close-coupling calculations. The effect of the three-body term in the interaction potential is explored by comparing quantum dynamics results from a pairwise potential that neglects the three-body term to that derived from the full interaction potential. Inclusion of the three-body term in the close-coupling calculations was found to reduce the limiting rate coefficients by a factor of two. The reaction exoergicity populates vibrational levels as high as v = 19 of the 6 Li2 molecule in the limit of zero collision energy. Product vibrational distributions from the close-coupling calculations reveal sensitivity to inclusion of three-body forces in the interaction potential. Overall, the results indicate that a simplified model based on the long-range potential is able to yield reliable values of the total reaction rate coefficient in the ultracold limit but a more rigorous approach based on statistical quantum or quantum close-coupling methods is desirable when product rovibrational distribution is required.