Appendix B
Transportation Infrastructure, Freight Services Sector and Economic Growth: A Synopsis
Figure 4
A theoretical graph with transportation services on the x axis and price on the y axis, depicting the horizontal supply function S, the constant cost of the transportation service, and the downward sloping demand function D, the amount users are willing to purchase at various prices. The difference between D and S, up to the amount Q, the equilibrium level of services consumed, is the consumer surplus (CS). A downward shift of the supply function from S to S' demonstrates an investment in transportation infrastructure that reduces the cost of the services. The sum of the areas A (the benefit of reduced cost for Q) and B (the consumer surplus on the increase in services consumed from Q to Q' due to the cost reduction) is the increase in CS.
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