2016 H2 Promo Exam Paper 1 QP

Jurong Junior College 2016 JC1 Promotional Examination ECONOMICS Higher 2 9757/01 Paper 1 23 September 2016 1 hr 10 minutes READ THESE INSTRUCTIONS FIRST Write your name and class on all the work you hand in. Write in dark blue or black pen on both sides of the paper. You may use a soft pencil for any diagrams, graphs or rough working. Do not use staples, paper clips, highlighters, glue or correction fluid. Answer all questions. At the end of the test, tie all your work securely together. The number of marks is given in brackets [ ] at the end of each question or part question. This document consists of 5 printed pages.

2 Answer all questions. Question 1 The Impact of Private Car-Sharing Application Firms on the Traditional Taxi Industry Table 1: Share of US business car-hire rides, % of total Types of car-hire rides 2014 2015 2016 Car rentals 55 50 40 Taxis 37 25 14 Private-hire cars 8 25 46 *Note: Private-hire car rides are rides such as Uber and GrabCar. Source: Certify, 2016 Figure 2: Market share of traditional taxi companies in Singapore Source: Land Transport Authority, 2016 Extract 1: Traditional taxi industry in Singapore Today, over 26,000 taxis from six taxi companies ply Singapore’s roads. These taxi companies spend millions of dollars acquiring and building up their taxi fleet, which are then rented out to taxi drivers at a fee. To help taxi drivers get more jobs, taxi companies have their own call service centres so that drivers can be better matched with passengers. In Singapore, all taxi rides are metered, based on a flag -down fare and the distance travelled. At present, the flag -down fare for standard taxis ranges between $3.20 and $3.90, but the distance rate does not vary across the six taxi companies. The most recent fare hike came about in 2011, when most of the taxi operators followed industry leader ComfortDelGro in raising the flag -down

3 fee by 20 cents. This raised concerns by taxi commuters, who complained that this fare hike came far too soon given the implementation of a $0.30 fuel surcharge by taxi operators in 2008. Sources: Land Transport Authority and ChannelNewsAsia Extract 2: New entrants turn the taxi industry on its head The rise of technology has caused upheavals in many industries around the world – arguably, the taxi sector is no exception. The disruptive technology and new business model brought about by the likes of private car -hire firms such as Uber and GrabCar are a godsend to long -suffering commuters frustrated with an inefficient system that is unable to match supply and demand during peak periods. A survey done by market research firm YouGov found that the top reasons for using pri