MIT1_201JF08_midterm - 1.201 11.545 ESD.210 Analysis Demand...

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1.201 / 11.545 / ESD.210 Transportation Systems Analysis: Demand and Economics Fall 2008 Midterm Exam Thursday, October 9, 2008 You have 1.5 hours to complete this exam. Show all your work to get full credit, and please clearly box your answers. This is an open book and open note exam A scientific calculator will be required to answer some of the problems on this exam Question 1 (34 points) A Freight Shipper's Mode Choice Model An independent trucking company is considering entering the lumber transport market in the Pacific Northwest, in which lumber companies currently have only two choices for how to ship their product: 1. Private Carriage (that is, ship it themselves with their own trucks) 2. Rail Freight The company has hired some consultants to help understand the current shape of the market for lumber shipping services. The first step in predicting the demand for this new trucking service is to estimate lumber companies' sensitivity to different shipping-related variables. A multinomial logit model was specified and then estimated on a dataset that included information on a number of shipping decisions made by shippers in the Pacific Northwest. Table 2.1 includes the specification of the model and the estimation results. TABLE 2.1: Model specification and estimation results Β ASC_PC Β SIZE Β VALUE β COST Β TIME Β RELIABILITY Β DIST_SIDING Private Carriage 1 0 0 COST_PC TIME_PC REL_PC 0 Rail Freight 0 SIZE VALUE COST_RAIL TIME_RAIL REL_RAIL DIST_ SIDING Estimated Coefficie nt 0.04 2.5 7.51 -14.14 -6.43 -3.48 -11.21
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Definitions of variables: ASC_PC is the alternative-specific constant for Private Carriage. SIZE is the size of the shipment in units of 10,000 pounds. VALUE is the commodity value of the shipment in dollars per pound. COST_PC is the cost of making the given shipment by Private Carriage, in units of $10,000. COST_RAIL is the cost of making the given shipment by Rail Freight, in units of $10,000. TIME_PC is the average transit time in transit of a given shipment by Private Carriage, measured in days. TIME_RAIL
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This note was uploaded on 12/04/2011 for the course ESD 1.210j taught by Professor Mosheben-akiva during the Fall '08 term at MIT.

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MIT1_201JF08_midterm - 1.201 11.545 ESD.210 Analysis Demand...

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