ECO 204 Assignment Week 2
Raise or Lower Tuition
ECO 204 – Principles of Microeconomics
January 25, 2015
Greg Kropkowski
Raise or Lower Tuition Many people expect to get at least an associate degree sometime in their lifetime. However, just some of them can really complete it without having to quit simultaneously. High tuition costs are the main reason people cannot continue going to college or university. Raising tuition can provide more revenue for the institution, but it can affect the enrollment of new students. On this exercise it will be discussed if raising tuition will result in more revenue, the conditions in under which revenue will rise, fall, or remain the same focusing on the relationship between the increased revenue from students enrolling at Nobody State University (NSU) despite the higher tuition and the lost revenue from possible lower enrollment. In addition, if the price elasticity were (-1.2) suggest how to expand the revenue and make recommendations to the University’s President. There are many options were institutions can use to help increase their revenues. Some of this options can include the rise of tuition and tuitions fees. Raising the tuitions fees can have some negative consequences like the decrease on the number of enrolled students. “Establishing tuition rates at institutions of higher learning is always of fundamental strategic importance to college administrators who are suffering adverse financial effects from reduced allocations from external sources and increased educational and facility costs.” (Bryan, G. A., & Whipple, T. W. (1995). Nobody State University can consider to increase their revenue especially under a harsh economic satiation for the current society.
Raising Tuition Tuition fees are the best way to obtain revenue. Higher education is considered an investment, so the cost of tuitions, fees, books and everything else are considered and investment for the future. Nobody State University needs to
ECO 204 – Principles of Microeconomics
January 25, 2015
Greg Kropkowski
Raise or Lower Tuition Many people expect to get at least an associate degree sometime in their lifetime. However, just some of them can really complete it without having to quit simultaneously. High tuition costs are the main reason people cannot continue going to college or university. Raising tuition can provide more revenue for the institution, but it can affect the enrollment of new students. On this exercise it will be discussed if raising tuition will result in more revenue, the conditions in under which revenue will rise, fall, or remain the same focusing on the relationship between the increased revenue from students enrolling at Nobody State University (NSU) despite the higher tuition and the lost revenue from possible lower enrollment. In addition, if the price elasticity were (-1.2) suggest how to expand the revenue and make recommendations to the University’s President. There are many options were institutions can use to help increase their revenues. Some of this options can include the rise of tuition and tuitions fees. Raising the tuitions fees can have some negative consequences like the decrease on the number of enrolled students. “Establishing tuition rates at institutions of higher learning is always of fundamental strategic importance to college administrators who are suffering adverse financial effects from reduced allocations from external sources and increased educational and facility costs.” (Bryan, G. A., & Whipple, T. W. (1995). Nobody State University can consider to increase their revenue especially under a harsh economic satiation for the current society.
Raising Tuition Tuition fees are the best way to obtain revenue. Higher education is considered an investment, so the cost of tuitions, fees, books and everything else are considered and investment for the future. Nobody State University needs to
References: Amacher, R., & Pate, J. (2013). Microeconomics principles and policies. San Diego, CA: Bridgepoint Education, Inc. Bryan, G. A., & Whipple, T. W. (1995). Tuition elasticity of the demand for higher education among current students: A pricing model. The Journal of Higher Education, 66(5), 560. Retrieved from http://search.proquest.com/docview/205336131?accountid=32521