A Small Private University Normally Charges the Same Price -$200-Per

question 47

Essay

A small private university normally charges the same price -$200-per credit-hour for all courses and for all students. While the university is pretty near capacity in the fall and spring, it finds that its classrooms are only about 60 percent occupied during the summer session. A student of operations management (who has recently read this chapter) wonders if yield management might be useful to both the university and its students alike. This student, with help from some economics majors, estimates a demand curve for summer course enrollment. Points on this demand curve include 9000 credit-hours at the current rate of $200, 12,000 credit hours at $180, 15,000 credit-hours at $160, and 18,000 credit-hours at $140. Based on this demand curve, what price point would best serve the university, if its objective is the greatest revenue for the summer session?

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Definitions:

Conceptually Problematic

Refers to ideas or theories that are difficult to understand, define, or apply due to vague or abstract premises.

Arnett

Refers to Jeffrey Jensen Arnett, a psychologist known for his work on emerging adulthood and development.

Feel Grown Up

The subjective experience of perceiving oneself as more mature or adult-like, often accompanied by increased responsibilities and changes in self-perception.

Age Ranges

Distinct categories into which human ages are divided for the purpose of study and analysis, often relevant in developmental psychology and sociology.