Pricing Dilema - Lbs vs Insead Mba

College has become a norm in today’s society so much so, that the average costs of higher education are not really discussed. A public two-year in-district college was $3,520 for a full-time undergraduate student in 2016-2017 (Baum 68). Baum also declares that a public four-year in-state undergraduate tuition was $9,650; a public four-year out-of-state college cost $24,930; a private nonprofit four-year college costs $33,480; and a for-profit college cost $16,000 for that same school year. (68). Across the nation, figures will vary because of the obvious geographical region differences, but also because of price discrimination. Price discrimination allows institutions to discount their prices for a lot of students (Baum 79). Institutions do this based on individual student circumstances, and it segments the market. Institutions

The cost of tuition among colleges and universities is highly diversified and indefinite. Students shouldn’t be financial problems that are associated with the high tuition cost for their education because it creates unnecessary stress and financial problems. The student’s primary concern should be their academic performance and learning. The tuition fee includes extracurricular expenses such as lifestyle amenities that may not be essential toward the student education yet they are still being charged for it. Universities and colleges are lacking a stable and regulated tuition system to provide a better education for a reasonable price. The high tuition cost affects the academic performance, enrollment in higher education, and increase

The following result associated with increase in the demand for enrolment in other colleges has convinced the president of Liberal Arts College that increasing tuition fees would lead to an increase in the quantity demanded. But Susan’s analysis is not accurate and the increase in enrollment along with increase in tuition fee is not because demand curve is upward sloping but because there is just an increase in demand for enrolment in these prestige colleges. Hence Susan’s analysis and suggestion of increasing the tuition fee and decreasing financial aid should not be accepted.

The overwhelming cost for higher educational institutions is causing a huge concern over whether higher education will be an attainable financial concept to the ordinary student in the upcoming years. Many Americans now tend to believe that the path to obtaining a degree has turned into distraught with financial traps. Recent studies done by the U.S. Department of Education show that “college tuition and fees have ballooned 1,120% since 1978. A year of college tuition for

On the contrary, some might say, “This doesn’t change the price.” Price discrimination, or the “sticker cost” of the college and the difference of what the average college student pays, is why college prices should stay high. In this way, only the best and most determined students will get the financial aid and colleges will get the best students. For example, MIT Tuition has been $46,400 for 9 months while Missouri University is $16,448 for four years. In this way, colleges are more successful and talented students are more successful.

It is quite obvious that receiving an education beyond high school is very expensive, but why? The cost of college has increased to more than half of what it was thirty-five years ago. Paul F. Campos, in his article “The Real Reason College Tuition Cost So Much,” scrutinizes the reasons why the price of college has gone up so much, and who is to blame for the problem. In his article, Campos answers his question of why higher education is so pricey now compared to then and explains the reasons behind this insane rise in tuition cost.

In the end, from a student’s demand perspective, demand is created from the human gratification aspect, whereas the costs and benefits of the university/college achievements are the main determinants in seeking higher education. From the institution supply perspective, supply depends on their most important single revenue source – funding (Fortin).

"Between 2002-03 and 2012-13, prices for undergraduate tuition, room, and board at public institutions rose 39 percent" (Digest of Education Statistics, Ch. 3). At private for-profit institutions it decreased 7% within the same years. There has to be a reason for this disparity and for why college prices seem to increase so much faster than inflation. In fact, there's at least three contributing factors. To begin with, college tuition prices follow the natural law of supply and demand (and demand for higher education is way up); moreover, government subsidies for students, which have increased over the years, fuel demand even more, and then, consequently, more money is spent to go towards making campuses more attractive and stay maintained

A number of researches have investigate the myths of rising college cost (Archibald & Feldman, 2012; Baumol, 1995; Bowen, 1980; Douglas & Keeling, 2008; Heller, 2011; Martin, 2011; Mumper & Freeman, 2011). In summary, the major factors that attribute to the rising college cost are: (1) the decline in state financial support for public higher education with the increasing support for other items (Mumper & Freeman, 2011); (2) higher education institutions set their goals to be academic excellence, prestige, and influence. To achieve these goals, they tend to generate revenue source and there is no limit for the money they can generate. So they raise all the money they can and spend all the money they raised. Raising

As good MBA candidates we have been taught to critically analyse assumptions to make informed and rational views on such statements. So what do the facts say?

The basic unit of analysis for measuring “affordability” of higher education is the cost of education. This cost is not simply

Unfortunately, college tuitions show no sign of digression but rather inflation to coincide with our current economy. An example of this is seen within private institutions, where a valued higher education is given and sought out after by employers, but is only obtained by the few who could afford it. The article “Recent Trends in U.S. Higher Education Costs and Prices: The Role of Government Funding” explains this relationship in the ways that

The tuition increases have come in response to the lack of federal funding to universities, leading them to find their own way to provide for their upkeep. “Recent increases in university tuition fees are part of a new entrepreneurial trend in higher education in which institutions are expected to generate more of their own revenue” (Quirke). The universities have decided that since they can no longer look towards federal funds to fuel their costs of maintenance and revenue, they must find a new route towards attaining much needed funds, and they have chosen to

Many colleges have extremely high costs compare to others. CMU is one of the institutions that has a higher cost than national average. The national average for “on-campus” student’s cost was “$19,182,” compare to CMU’s “$21,391” in 2010 (Peck). This shows that CMU’s cost was about $2,200 higher, which is approximately 10%. Also, CMU has higher

From the economic standpoint, yes I can say that obtaining a MBA is very expensive, but I know in the long run it is a minor investment compared to the amount of opportunities that will be available to me in the future.