Roadway costs can be categorized in various ways for cost allocation analysis:
Short Run Marginal Cost (SRMC) only includes costs imposed using current capital resources,
ignoring other costs, such as vehicle and roadway capital costs.
Long Run Marginal Cost (LRMC) includes all costs imposed, including past investment costs
and the opportunity cost of land and other resources, but ignores sunk costs (unrecoverable costs
already incurred).
Fully Allocated Costs (FAC, also called cost recovery) includes all infrastructure costs,
including sunk costs, allocated among users in some way that is considered equitable.
Pay-As-You-Go (PayGo) means that financial investments made each year are allocated to users
as a group during that year, so no funds need be borrowed.