Why are network speed tests slower with further away servers?

Solution 1:

Tcp requires acknowledgement for each packet. There is a window size, which allows for some reordering and latency, but this is limited. Once a computer has sent that much data, it has to wait for an acknowledgement, so max throughput is limited by latency, as seen on the Wikipedia page: http://en.m.wikipedia.org/wiki/TCP_tuning#TCP_speed_limits