1 Explain the relationship between rate and price 2 Calculation Determine how to price a truckload shipment that is 1,500 miles using the average cost method For a carrier that runs 300,000 miles per year and gets an average fuel efficiency of 6 miles gallon Expense Type Annual (unless noted as per mile) Expense Cost Tractor trailer $600,000 (4 year depreciation) Maintenance (Variable) $ 12 mile Administrative $80,000 Fuel (Variable) $3 60 gallon Driver Wages (Variable) $ 54 mile Insurance $10,000 Broker Board Quotes $1,800 $2,500 $3,500 $3,000 3 Calculation Determine how to price a truckload shipment that is 1,800 miles using the Variable Cost of Service method for the above company 4 Calculation Determine how to price a truckload shipment that is 1,000 miles using the Market Value of Service method for the above company for a last minute request going from New York to Texas

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Question: 1. Explain the relationship between rate and price. 2 Calculation: Determine how to price a truckload shipment that is 1,500 miles using the average cost

1. Explain the relationship between rate and price.

2 Calculation: Determine how to price a truckload shipment that is 1,500 miles using the average cost method. For a carrier that runs 300,000 miles per year and gets an average fuel efficiency of 6 miles/gallon.

Expense Type	Annual (unless noted as per mile) Expense Cost
Tractor trailer	$600,000 (4-year depreciation)
Maintenance (Variable)	$.12/mile
Administrative	$80,000
Fuel (Variable)	$3.60/gallon
Driver Wages (Variable)	$.54/mile
Insurance	$10,000
Broker Board Quotes	$1,800	$2,500	$3,500	$3,000

3 Calculation: Determine how to price a truckload shipment that is 1,800 miles using the Variable Cost of Service method for the above company.

4 Calculation: Determine how to price a truckload shipment that is 1,000 miles using the Market Value of Service method for the above company for a last-minute request going from New York to Texas.

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