Price Discrimination

Many entrepreneurs engage in price discrimination.
What is price discrimination?

The New Economics of Higher Education

• The article states "Yet even the discounted tuition she is paying more than covers Tulane's cost of educating an extra freshman."
  If economic language, what does this mean?

   

• Are college grants (scholarships) a form of price discrimination? Why or why not?

   

• In economic terms, what does the author mean when he states that "The loss of a handful of elite students who turned down the $10,000 offer but might have jumped at $20,000 was more than offset by the enrollment of larger numbers of still excellent freshmen with combined SAT scores above 1,350."?
  What does this statement imply about the elasticity of demand for for a Tulane education? Why?

   

• Tulane is using scholarship aid to attract minority applicants and increase their enrolment at the school. Why do you believe that some minority students have a more elastic demand for higher education than some other groups? (i.e., what determinant of price elasticity of demand do you believe is most important in determining their price elasticity of demand?)

   

How did John Hopkins University decide to alter its financial aid grants to increase the university’s revenue? What students received more financial aid? Which students received less financial aid? Why did this increase the university’s revenue?

 

Why do you think that Carnegie Mellon University give less financial aid to students who apply for early admission than to students who apply later?

 

• What states have CUBs and when was each established?

   

• What is the objective of CUBs?

   

• Why is it necessary to have an organization like CUB to carry out the above objective?

   

• How much money does Democracy Watch say that the Illinois CUB saved consumers?
  How do you think CUB helped generate these savings?

   

Last updated April 12, 2002

Send comments to: jbremer@oakton.edu