4.Based on your answer for the questions 1 to 3, give critical comments on if " Grab acquired Uber" is a good move and if the government should intervene in some ways?

Price control?

Tax?

Anything else?

Articles

https://www.straitstimes.com/business/companies-markets/grab-buys-ubers-south-east-asia-business-uber-gets-275-stake-in-grab

https://www.todayonline.com/singapore/big-read-why-grab-uber-deal-making-some-uneasy

Questions 1,2,3

1, Before Grab acquired Uber, what type of market structure did Grab and Uber operate in? Why did Uber make loss along the years? Oligopoly for private car market (two players: duopoly) Characteristics 0 A few players have significant market share (research) - Selling similar good/service Relatively high barrier of entry (research) Interdependent kinked demand curve 0 Reduce price, sales donot increase substantially. - Graph the loss 2, Do you agree that after the acquisition, market structure would be monopoly? Justify your opinion. 0 Monopoly for private car market 0 Characteristics of monopoly One firm? No close substitute? Depend on how you define the industry (make proper assumption) 3, After acquisition, would there be any changes in terms of price, quantity, innovation, service quality and other aspects of the sharing car service? - Graph to show that price is higher when compared to perfect competition and quantity has been restricted in comparison to perfect competition. - Critical thinking 0 Less innovation and service and lower quality is expected? 0 More innovation and better service quality