Question

Consider Auburn's MBA program:
a) What is the relationship between the program’s average costs and the number of students in the program? Graph it out, supposing the current average cost is $10K per student/year with 30 full-time students. Do you think average cost will increase or decrease with more enrollment? Why?
b) Is it potentially efficient to offer different concentrations to MBA students? Explain.
c) Does the university price-discriminate? How?

Answer 1

a)

There exists a diminishing connection between the average costs and the number of enrolled students in the program. That is, as the number of enrolled students expands, the average cost of the program diminishes, as the weight of total expense of the program will currently be shared among more number of students.

With greater enlistment, the average cost will diminish, as a similar cost will be borne by more number of students, and in this way the AC falls.

b)

Truly. It is proficient to offer various fixations to MBA understudies, similar to finance, operations, HR and so forth as it will make the program look progressively enhanced and subsequently pull in more understudies, without adjusting the school's cost structure a lot. Likewise, it enables the school to cost segregate understudies by portioning them into various course focuses.
Also offering different concentrations within MBA makes the course diversified.

c)

Yes, the university practices price discrimination by offering diverse convergence of MBA. The college attempts to suit an ever increasing number of understudies by pulling in them in different distinctive MBA focuses in various expenses structure with the goal that an understudy who wishes to pay lower charges and still need a MBA gets selected and the college earns money.

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