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6. Challenges rail privatisation faced - TOCs found short franchise periods and large sunk costs a barrier to?

  • Investment
  • Profit
  • Entry

7. When the UK rail industry was privatised, it was split into four sections. Which of these is incorrect?

  • Freight Operations: Freight operating companies (FOCs)
  • Rolling stock companies (ROSCOs)
  • Passenger Operations: Train operating companies (TOCs)
  • Train leasing companies (TLCs)
  • Infrastructure: Network Rail

8. A privatised rail industry does NOT allow which thing?

  • A competitive market
  • Increased competition
  • Natural monopoly
  • Increased contestability
  • More productive and allocative efficiency
  • Specialisation

9. Which one of these is NOT a form of regulation for the rail industry

  • RPI X formula
  • Rate of Return
  • CPI X formula
  • Yardstick regulation

10. What year was the UK rail industry nationalised and operated by a public cooperation?

  • 1996
  • 1946
  • 1958

11. Open Access companies are able to compete against franchise holding firms. e.g.?

  • Grand Central and Hull Trains
  • Virgin Trains
  • National Express

12. The rail market may not be contestable because there are high start up costs, economies of scale of established firms, restrictions on where passengers can be picked up/dropped off, and limited availability of rolling stock.

  • True
  • False

13. The DFT invites TOCs to bid for a _________ to run a given rail service.

  • Franchise
  • Train
  • Amount of time

14. Which TOC could NOT afford their franchise payments (perhaps their costs were higher than expected)

  • National Express
  • Virgin Trains
  • Hull Trains

15. What crash occurred in 2006?

  • Oxford street crash
  • Hatfield crash
  • Mile End crash

16. Who regulates the rail industry?

  • The Transport Committee of Rail Regulation (TCRR)
  • The Office of Rail Regulation (ORR)
  • The Ministry of Rail Regulation (MRR)

17. The subsidy given to TOCs to ensure loss making but socially essential services operate e.g. rural lines and late night services. What is this?

  • Public service obligation
  • Government failure
  • Cross-subsidisation

18. Which barrier to entry is not an issue in the train passenger market?

  • Sunk costs
  • Start up costs
  • Brand loyalty
  • Economies of scale

19. Decades of underinvestment in infrastructure and increasing demand for rail travel means the current network is unable to meet?

  • Peak time demand
  • Demand
  • Productive efficiency

20. Challenges rail privatisation faced - Infrastructure and operations are?

  • Interlinked
  • Separate
  • Interdependent