Terminal Costs

The above graph represents a simplified assumption concerning transport costs for three modes. It should be noticed that the cost curves all begin at some point up the cost axis. This represents terminal costs, and as can be seen, shipping (T3) and rail (T2) start with a significant disadvantage compared to road (T1).

Copyright © 1998-2008, Dr. Jean-Paul Rodrigue, Dept. of Economics & Geography, Hofstra University. For personal or classroom use ONLY. This material (including graphics) is not public domain and cannot be published, in whole or in part, in ANY form (printed or electronic) and on any media without consent. Permission MUST be requested prior to use.