Reply to dont be in the 60th to 99th percentile in income

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[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous]Try to understand the operational business model of a University college using student tuition as the revenue stream.  Sure there are the endowment and research grants revenue streams, but focus on the Tuition line of business.

Tuition revenue from the high income family students is used to not only cover their tuition cost but also to cover the tuition cost of the other half of the student population from mid to low income families.  So when a high income student pays, say $30k in full tuition, $15k goes to cover that student's instruction costs, and the other $15k goes to cover another qualified low income student in the form of financial aid.  There is nothing to debate here: university needs full tuition paying students to exist as a business.  In other words, low income merit students need the high income students to be enrolled and fully pay their tuition on time.

That said the challenge is finding high income students who are absolutely committed to staying the full four years as well as academically willing to put in the effort to satisfy the graduation requirements that are tied to the university ranking.  This is no trivial challenge, finding high income students who are also studious.  Here is where the legacy students come into the picture. Legacy students bring the emotional commitment to stick around for full four years paying full tuition and graduate with a degree.  By offering admissions to studious legacy students, the university is making sure the lower income students have a reliable funding source to cover their tuition costs.  [/quote]

Exactly. Legacy (along with the “development list” or whatever the individual college calls it) is a way to appear to be complying with their commitment to be “need blind” without maintaining a certain % of full pay students. There is no way that these universities would maintain such a consistent, year in, year out balance between full pay and scholarship students without some sort of finger on the scale. It’s just not plausible. [/quote]

Except that some of these schools have endowments so big that they are basically just investment funds that run a school on the side for funsies. I think I read somewhere that the investment income alone from Harvard fund is greater than the entire budget of Harvard. This means they could offer free tuition to *everyone* and their endowment would still grow every year. [/quote]

My husband has said when the market/economy changes a big chunk of these endowments are going to disappear overnight-due to these investments. It’s going to change a lot of the way they have been operating.0[/quote]

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