The next 4 questions are based on the information below. Uber Eats (UE) is an online food ordering and delivery platform launched by Uber in 2014. UE gives users access to restaurant /store menus, ratings, and estimated delivery times. Users can then order and pay for items from participating restaurants and stores using the UE application, or through a web browser. Users (or customers) are also able to tip for delivery. Meals are delivered by delivery drivers using cars, scooters, and bikes. UE is operational in over 6,000 cities across 45 countries. Revenues generated from the user's order is split between UE, delivery drivers and the restaurants. UE revenues from customer (users) Delivery Fee - based on location, the merchant you are ordering from, and the availability of delivery people. Service Fee - 10% of order value (minimum $1 and maximum $4) Busy Area Fee - a fixed fee added to the delivery fee when there are more Uber Eats orders in a certain area than delivery people. Priority Fee - opt-in option to have food delivered directly to you. Wrong Delivery Address Fee - charged when the address is changed after the order has been placed Uber Pass subscription - subscribers enjoy savings on rides and deliveries UE revenues from merchant (i.e., restaurants) Activation Fee - covers cost of set up, professional photography, initial account management and support. Commission Fee - charged for orders placed via Uber Eats: Between 25 and 30% of order value + GST Marketing Fee (when selected by merchant) - charges for advertising the business on the Uber Eats platform Major cost items for Uber Eats Incentives to attract customers (e.g., discount vouchers) Marketing costs - advertising the UE platform on various channels such as TV, digital platforms, radio and print Delivery driver costs - incentives (e.g., sign up bonuses), payment for deliveries and pay for items from participating restaurants and stores using the UE application, or through a web browser. Users (or customers) are also able to tip for delivery. Meals are delivered by delivery drivers using cars, scooters, and bikes. UE is operational in over 6,000 cities across 45 countries. Revenues generated from the user's order is split between UE, delivery drivers and the restaurants. UE revenues from customer (users) Delivery Fee - based on location, the merchant you are ordering from, and the availability of delivery people. Service Fee - 10% of order value (minimum $1 and maximum $4) Busy Area Fee - a fixed fee added to the delivery fee when there are more Uber Eats orders in a certain area than delivery people. Priority Fee - opt-in option to have food delivered directly to you. Wrong Delivery Address Fee - charged when the address is changed after the order has been placed Uber Pass subscription - subscribers enjoy savings on rides and deliveries UE revenues from merchant (i.e., restaurants) Activation Fee - covers cost of set up, professional photography, initial account management and support. . Commission Fee - charged for orders placed via Uber Eats: Between 25 and 30% of order value + GST Marketing Fee (when selected by merchant) - charges for advertising the business on the Uber Eats platform Major cost items for Uber Eats Incentives to attract customers (e.g., discount vouchers) Marketing costs - advertising the UE platform on various channels such as TV, digital platforms, radio and print Delivery driver costs - incentives (e.g., sign up bonuses), payment for deliveries Customer / Merchant / Delivery person support (phone, chat, email) UE app development, maintenance Other costs (Insurance, Legal, Card transaction costs) D Question 34 3 pts Uber Pass is a subscription service that provides subscribers with discounts. In return for a fixed payment each month, subscribers pay $0 delivery fee with Uber Eats (minimum order amount applies) and get other discounts across the Uber family. One of the challenges of Uber Pass for UE is the adverse selection problem with respect to the customer who sign up for Uber Pass. In your own words, explain what the adverse selection problem is for UE. Edit View Insert Format Tools Table 12pt Liv MY Paragraph B IU A
