Memorandum for Big State University

Memorandum for Big State University - To: Memorandum BIG...

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Memorandum To: BIG STATE UNIVERSITY GOVERNING BOARD CC: DR MAYUR DESAI From: ABAYOMI ODUTOLA AND FATOUMATA DIAKITE Date: 15:02:31 Re: FRESHMAN ACCEPTANCE PROBLEM My colleague and I have studied the issue before us and analyzed different scenarios to determine the right mix of freshmen to be admitted to the university. Our goal is to maximize the income after tax while still achieving our academic standards. A total number of 10,000 students can be admitted with a minimum of 3,000 and no more than 4,000 Big State resident freshmen are to be admitted. The school has academic goals for its freshmen. The average GPA for all freshmen should be at least 2.6 on a 4.0 scale. The state legislature feels that the university will run itself like a business and it must tax itself on paper. After tax net income from freshmen is expected to be equal to at least 25 percent of total revenue. A second option is requested to increase net income by 5% to cover increased fuel costs. We have analyzed two scenarios and have results to assist the university in making that decision. BIG STATE UNIVERSITY (OPTION 1) BIG STATE UNIVERSITY Changing Cells Number of Big State residents 3000 Number of X State residents 3400 Number of Y State residents 2600 Number of Z State residents 1000 Constants Tax Rate 0.28 Yearly Tuition, Room and Board: Big State resident 8000 X State resident 13000 Y State resident 13000 Z State resident 13000 Yearly cost of instructing a student 3000 Yearly cost of housing and feeding a student 2000 Fixed Administrative cost - year 25000000 Expected Freshman GPA (of 4.0) Big State resident 2.5 X State resident 2.7 Y State resident 2.8 1
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Memorandum for Big State University - To: Memorandum BIG...

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