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Cost functions for university education Economists Rajindar and Manjulika Koshal studied the cost functions of universities in the US. They estimated the marginal and average costs of educating graduate and undergraduate students in 171 public universities in the academic year 1990–91. See Source: Rajindar K. Koshal and Manjulika Koshal. 1999. 'Economies of Scale and Scope in Higher A Case of Comprehensive Education: Universities'. Economics of Education Review 18 (2): pp. 269–77. Below you can see the average and marginal costs per student for the year 1990-91 that Koshal and Koshal calculated from their research. Undergraduates Graduates Students 2,750 5,500 8,250 11,000 13,750 16,500 Students 550 1,100 1,650 2,200 2,750 3,300 MC ($) 7,259 6,548 5,838 5,125 4,417 3,706 MC ($) 6,541 6,821 7,102 7,383 7,664 7,945 AC ($) 7,659 7,348 7,038 6,727 6,417 6,106 AC ($) 12,140 9,454 8,672 8,365 8,249 8,228 Total cost ($) 21,062,250 40,414,000 73,997,000 88,233,750 100,749,000 Total cost ($) 6,677,000 10,339,400 18,403,000 22,684,750 27,152,400

Cost functions for university education Economists Rajindar and Manjulika Koshal studied the cost functions of universities in the US. They estimated the marginal and average costs of educating graduate and undergraduate students in 171 public universities in the academic year 1990–91. See Source: Rajindar K. Koshal and Manjulika Koshal. 1999. 'Economies of Scale and Scope in Higher A Case of Comprehensive Education: Universities'. Economics of Education Review 18 (2): pp. 269–77. Below you can see the average and marginal costs per student for the year 1990-91 that Koshal and Koshal calculated from their research. Undergraduates Graduates Students 2,750 5,500 8,250 11,000 13,750 16,500 Students 550 1,100 1,650 2,200 2,750 3,300 MC ($) 7,259 6,548 5,838 5,125 4,417 3,706 MC ($) 6,541 6,821 7,102 7,383 7,664 7,945 AC ($) 7,659 7,348 7,038 6,727 6,417 6,106 AC ($) 12,140 9,454 8,672 8,365 8,249 8,228 Total cost ($) 21,062,250 40,414,000 73,997,000 88,233,750 100,749,000 Total cost ($) 6,677,000 10,339,400 18,403,000 22,684,750 27,152,400

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
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What are the shapes of the total cost functions for undergraduates and graduates? (You could sketch them using what you know about marginal and average costs.) Plot them on a single chart using the numbers in the total cost column
Cost functions for university education Economists Rajindar and Manjulika Koshal studied the cost functions of universities in the US. They estimated the marginal and average costs of educating graduate and undergraduate students in 171 public universities in the academic year 1990-91. See Source: Rajindar K. Koshal and Manjulika Koshal. 1999. 'Economies of Scale and Scope in Higher Education: A Case of Comprehensive Universities'. Economics of Education Review 18 (2): pp. 269–77. Below you can see the average and marginal costs per student for the year 1990-91 that Koshal and Koshal calculated from their research. Undergraduates Graduates Students 2,750 5,500 8,250 11,000 13,750 16,500 Students 550 1,100 1,650 2,200 2,750 3,300 MC ($) 7,259 6,548 5,838 5,125 4,417 3,706 MC ($) 6,541 6,821 7,102 7,383 7,664 7,945 AC ($) 7,659 7,348 7,038 6,727 6,417 6,106 AC ($) 12,140 9,454 8,672 8,365 8,249 8,228 Total cost ($) 21,062,250 40,414,000 73,997,000 88,233,750 100,749,000 Total cost ($) 6,677,000 10,339,400 18,403,000 22,684,750 27,152,400
Transcribed Image Text:Cost functions for university education Economists Rajindar and Manjulika Koshal studied the cost functions of universities in the US. They estimated the marginal and average costs of educating graduate and undergraduate students in 171 public universities in the academic year 1990-91. See Source: Rajindar K. Koshal and Manjulika Koshal. 1999. 'Economies of Scale and Scope in Higher Education: A Case of Comprehensive Universities'. Economics of Education Review 18 (2): pp. 269–77. Below you can see the average and marginal costs per student for the year 1990-91 that Koshal and Koshal calculated from their research. Undergraduates Graduates Students 2,750 5,500 8,250 11,000 13,750 16,500 Students 550 1,100 1,650 2,200 2,750 3,300 MC ($) 7,259 6,548 5,838 5,125 4,417 3,706 MC ($) 6,541 6,821 7,102 7,383 7,664 7,945 AC ($) 7,659 7,348 7,038 6,727 6,417 6,106 AC ($) 12,140 9,454 8,672 8,365 8,249 8,228 Total cost ($) 21,062,250 40,414,000 73,997,000 88,233,750 100,749,000 Total cost ($) 6,677,000 10,339,400 18,403,000 22,684,750 27,152,400
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