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Transcription of this question: 5.Taxi-M (TM)Taxi-M (TM) operates 2500 taxis in a developing country. All drivers are full-time employeesand have a professional taxi license. Although not compulsory, TM regularly conducts safetyinspections of the taxis. Though safe, most of TMs taxis are old and TM charges high prices.Many customers complain.However, a multinational company, RE, with offices around the world, has started to offer amobile application (app) called Best-Taxi (BT). Using their mobile phones, passengers can useBTto book and pay for a car journey. Any car owner can offer journeys through BT. For securityreasons, the BT app registers passengers’ and drivers’ personal details.TMs sales are falling and profits are down. A number of TMs drivers are becoming demotivated.Facing lower incomes, poor management and rumours of redundancies, many loyal drivers haveleft to offer taxi services using their own cars and the BT app. Some of these drivers are earningconsiderably higher wages than before.The situation for TM appeared critical. However, local media have reported a higher rate of roadaccidents by BT drivers than licensed taxi drivers. Several of its drivers have assaulted androbbed customers. In response, TMs management decided to downsize and differentiate itselffrom BT by positioning its service as a high-price, high-quality traditional taxi service. TMwill:sell older cars and lease new luxury carsdevelop a unique selling point/proposition (USP) emphasizing comfort and safety.Customers can book taxis by telephone and by stopping them in the street. TMs target market willbe business people, higher income families and passengers concerned about safety.(a)(b)(c)(d)Define the term redundancy.Explain one positive and one negative impact of the multinational company, RE, on thedeveloping country.With reference to Maslow’s motivation theory, explain two reasons that some TMdrivers left to drive for BT.Discuss the new strategy to differentiate TM from BT.[2][10]

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