Final answer:
Transportation companies like CSX offer various transportation modes for efficiency and flexibility, optimizing for cost and speed. Bus companies likely preferred a narrow market definition of intercity bus service to enhance market position. Urban areas subsidize transit systems for community benefits despite the cost.
Step-by-step explanation:
Transportation companies like CSX offer customers a complete choice of different transportation modes to provide flexibility and efficiency in the transportation of goods. By utilizing modes such as rail, highway, and perhaps water or air, companies can optimize for cost savings, speed, and reliability. This selection allows customers to customize the transportation of their goods according to their specific needs, including considerations for shipping finished goods over various distances, through urban areas, and in different geographical environments.
Regarding the merger of Greyhound Lines, Inc. and Trailways Transportation System, the preferred definition of the market by the bus companies was likely "the market for intercity bus service" because it limits the scope of competition and enhances their market position. In contrast, including personal cars, car rentals, passenger trains, and commuter air flights broadens the market definition, thereby decreasing their market share and likely increasing regulatory scrutiny.
Urban transit systems are often subsidized by urban areas to promote accessible and affordable transportation for all citizens, reduce traffic congestion and environmental impact, and encourage economic development. While this may pose a significant cost to the city, the argument for subsidies is grounded in the overall benefits to the community's quality of life and economic health.