Instructions
1. Read article ” Opinion: Basic economics means Uber and Lyft cant rely on driverless cars to become profitable” The article discusses the profitability of ridesharing companies such as UBER and Lyft and suggests that introducing driverless cars alone wont improve profit positions of ridesharing companies.
2. Create a paper in the form of an APA formatted article that addresses the following questions. Please use apply concepts and theories learned from the textbook to support your ideas, including at least 1 intext citation.
o What sort of industry are ridesharing companies operate in terms of competition structure in the marketplace? Cant we see some other companies, in the future, enter this market? Explain why or why not.
o The price competition between UBER and Lyft, both publicly trading companies now) lowers the prices to the benefit of consumers (riders) at the expense and losses.
Can they not be profitable if there is pretty much only two firms servicing the market? Explain.
In addition, explain what some of the direct and indirect costs and risks might be (ethical and legal perspective might be useful) that these companies face.
o The article concludes by suggesting that these companies should look elsewhere for improving their profitability. What does that mean? Provide some examples.
https://www.marketwatch.com/story/basic-economics-means-uber-and-lyft-cant-rely-on-driverless-cars-to-become-profitable-2019-08-12
Farnham, P. G. (2014). Economics for managers (3rd ed.). Upper Saddle River, NJ: Pearson Education, Inc.
o Chapter 9
o Chapter 10
