In Order for a Freight Railroad to Take Advantage of Revenue

question 4

Multiple Choice

In order for a freight railroad to take advantage of revenue management opportunities,

• A)there must be no air freight.
• B)they should establish regularly scheduled trains.
• C)they must reserve one box car on each train for luxury items.
• D)there must be no air freight or truck transportation.

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Definitions:

Marginal Productivity Theory

An economic theory suggesting that payment to factors of production equates to their marginal contribution to the output.

Value Added

The increase in the value of a product or service as a result of a particular process, typically measured as the difference between the cost of inputs and the price it's sold for.

Profit-Maximizing

A strategy or point whereby a firm selects the output level at which its profits are at their highest.

Marginal Product

The additional output resulting from the use of one more unit of a production factor.