Pipeline accounts for 20% of the total intercity tonnage shipped in the U.S. However their revenues are only 4% of the total intercity transportation revenues. Why is this?
A) high incidence of loss and damage
B) low reliability
C) Shipper's ability to negotiate lower rates because of intense completion among modes
D) low rates

Question

Quizplus · Accepted Answer

The discrepancy between the percentage of tonnage shipped and the percentage of total revenues can be attributed to low rates charged by pipelines compared to other modes of transportation. This makes pipelines a cost-effective option for shipping large quantities of goods, but it also means they generate less revenue per ton shipped.

Pipeline Accounts for 20% of the Total Intercity Tonnage Shipped