Low Estimate , High Estimate ,Fare Calculation and Use of Surcharge! By making the above tables and doing the analysis we found out that,
LOW ESTIMATE
Minimum Fare or Low estimate are equal in almost 100 percent cases.
Low Estimate = (Base Minimum fare) * Surcharge
Like in first case For Uber x, Timezone 6,Low Estimate = 8 * 1.6 = 13
HIGH ESTIMATE
This depends on two factors Duration and Distance
At the time query is made, uber makes the query in the google traffic api and find the two times
Time factor = (Time(with traffic) - Time(without traffic)) * price/dur
Distance factor = (Distance(More maybe due to traffic) - Distance(Normal)) * price/distance
Total factor = (Time factor + Distance Factor)*surcharge
Like in second example in Timezone 16, Total factor = (11-6)*0.35*2.2 = 3.85
Hence , High estimate = Low Estimate + total factor = 17 +3.85 = 21
FINAL FARE CALCULATION
Total Fare = (Base Fare + Duration*(price/min) +Distance*(price/mile) )*surcharge
Updated Min fare = Base Min fare * Surcharge
if Total Fare < Updated Min Fare then Total Fare = Updated Min Fare
Even if fare is less than minimum , this is charged to the user.
So even if , we use uber for very small rides , uber will charge us the whole amount.
This formula was also verfied over all the data collected for four timezones and it was true in 99.99 percent cases
SURCHARGE
This tells us that by using the dynamic surcharge which changes depending on location and time, uber is able to earn most of its revenue.
It increases the Minimum Fare and thus earns the most even in very short trips.
Graph was plotted where only the small trips where the Total Fare was less than Minimum Fare and Uber Earned More
This was plotted for all Timezones 6,10,16,20 The plot is given below: