Collecting the above percentages for the various items we have Table XXIV, which shows that the average cost of operating a small additional distance will be about 33% of the average cost per unit distance. If the additional distance amounts to several miles, the added cost will amount to about 50% of the unit cost. These figures may also be considered as the saving in operating expenses resulting from a shortening of the line, and thus gives a measure of the operating value of reducing the length of the line. The average cost of a train-mile since 1890 has varied between 91.829 c. in 1895 to 148.865 c. in 1910. The cost has been rising almost steadily since 1897. Whether the cost will continue to rise or whether it will recede during the next few years is of course a matter of pure conjecture. Even if the cost recedes somewhat from the high value of recent years, it is quite certain that it will never again sink to the low value of 1895.

If we adopt the round number of \$1.50 as the probable cost of a train-mile during the next few years, we can reduce the above percentages to cents per train-mile, which will come to 50 and 73 c. per train-mile respectively.

Some trains run 365 days per year; others run but 313 days. The tendency, however, is toward the larger figure, especially in the case of freight service, which comprises about 52% of the number of train-miles. The added cost per daily train per year for each foot of distance would therefore be 50X365X2 = 6.91 c. 5280.

When the distance is measured in miles the added cost per daily train per year for each mile of distance would be .73X365X2 = \$533.

Of course, if such calculations are made for a light traffic road which only runs trains on week-days, we should use 313 in the above equations instead of 365. It should be noted that the subitems in the above table which are the most uncertain are those whose absolute value is the smallest, and that even if we make very large variations in the most uncertain items, the final result will not be very materially altered. On the other hand, the very largest items are those which are capable of fairly precise calculations. The numerical illustration of the capitalized value of saving distance will be given later, see § 177.

## Effect Of Distance On Receipts. 151. Classification Of Traffic

Although there are numerous methods of classifying traffic, the best classification for the purpose of this discussion is to divide all traffic into two general divisions, through traffic and local traffic, the through traffic being here considered to mean traffic which passes over two or more roads even though the total haul may be less than 100 miles. On the other hand, local traffic is here considered to mean traffic that is entirely confined to one road, even though it travels from one end of the system to the other. The following discussion will require a subdivision of this classification into five classes:

(a) Non-competitive local - on one road with no choice of routes.

(b) Non-competitive through - on two or more roads, but with no choice.

(c) Competitive local - a choice of two or more routes, but the entire haul may be on the home road.

(d) Competitive through - direct competition between two or more routes, each passing over two or more lines.

(e) Semi-competitive through - a non-competitive haul on the home road and a competitive haul on foreign roads.

It will be found that any other possible combination of conditions may be placed under one of the above five classes, so far as its essential effect on receipts is concerned. In this discussion the term "home road" applies to the road with whose finances we are directly concerned. The term "foreign road" applies to any other road with which traffic is exchanged, and which may or may not suffer loss through any change of policy on the home road.