Private colleges vastly outspent public peers. The Fort Wayne, IN Journal Gazett

Question

Private colleges vastly outspent public peers. The Fort Wayne, IN Journal Gazette reported on July 10, 2010 that: "Private institutions, on average, laid out $19, 520 per student for instruction lin 2007, a 22 percent increase from a decade earlier", the Delta Project on Postsecondary Education costs, Productivity, and Accountability, a Washington-based nonprofit research group said Friday. Public universities spent $9, 732 for each student, up 1o percent in the decade, according to the report. How much did private colleges spent per student in 1997? When adjusted for inflation, what was the actual percent change in the amount spent per student by private colleges from 1997 to 20o7? (You may use any method; it may help to treat the increase in expenditures as "a raise and use the same approach we used in class to find the real raise, or pay cut, " if applicable) How much did public colleges spent per student in 1997? When adjusted for inflation, what was the actual percent change in the amount spent per student by public colleges from 1997 to 2007? (You may use any method; it may help to treat the increase in expenditures as "a raise" and use the same approach we used in class to find the "real raise, " or "pay cut, " if applicable)

Explanation / Answer

ANSWER

A)

Private college spending perstudent in 2007 increased 22% to $19,520. spending per student in 1997 was

$19,520 /1.22 = $16,000.

B)

Converting those dollars in 1997 to the equivalent in 2007 gives about $20,669.61 $20,670. That is more than they actually spent, so when adjusted for ination spending decreased. To see just how much I computed $19,520 / $20,670 = 0.944363812

They are spending only about 94% of what they used to.

C)

for public college per student spending gives a 10% increase from $9,732 /1.10 $8,850.

Converting those dollars in 1997 to the equivalent in 2007 gives about $11,400.

D)

The relative decrease in real dollars is $9,732 / $11,400 = 0.853684211. That means that they are spending about 15% less. The 10% increase didn’t nearly keep up with inflation.

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