For more detailed information, use AP EXAM PAST AND PRESENT book pg.142

The railroad was a critical component of the American economy during the late nineteenth century.
The railroad industry was responsible for may of the economic developments because:
1) With the construction of almost 200,000 miles of new railroads during the second half of the nineteenth century, the steel and iron industries prospered.
2) An increase in the amount of railroads allowed producers of just about every product a dramatically improved transportation system.
3) The transcontinental railroad allowed goods to be moved from coast to coast, over terrain that had been difficult to navigate by other methods. It increased the speed of the moving goods by seven times.
4) Railroads also opened up new markets and created an increase in number of consumers available to all industries.

Simply put, the requirements of the railroad and the improved access to markets for producers made the railroad industry critical to the american economy during the late nineteenth century.