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
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
Related questions
Question
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
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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