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There are two kinds of universities in the United States of America: public universities and private ones. It is clear that public universities are financed from public funds or from state or federal budget. Whereas private universities are financed from tuition fees and from income from private organizations. The point is that in the times of the world’s economic crisis it is difficult for companies to maintain universities because universities are nonprofit organizations. That is why every university is seeking ways to increase the revenue and to give proper education to its students. This paper is devoted to the issue of how increasing tuition will influence the university life and its ability to survive. It is obvious that there are several ways of increasing income: to raise tuition, to lower it or to remain the same while seeking financial help from different funds. It is significant to realize how all those three options will influence the future of the university.
In the paper, it is assumed that Nobody State University has raised the tuition and it has influenced the revenue. The paper will be divided into three parts, each of them will contain the explanation under which circumstances the revenue will rise, under what circumstances it will fall and in what cases it will remain the same. The last part will contain conclusions based on the research and the advice for the Nobody States University what to do to help the University to survive.
The rise of revenue
To understand whether it is worth raising the tuition fees, it is important to realize that the amount of taxes paid by the university will raise as well. That is why the university will need to raise the tuition again to survive. Some think that it is easy to raise the tuition and the income will rise as well. However, if students pay more, they will demand better professors, better living or studying conditions. It may become unprofitable to raise tuition. That is why, in my opinion, the university should increase the tuition only for some categories of students, for example, for international students. The amount of money that the university gets will raise, but not so much to pay such taxes that will drown the university. Another category of those who may pay higher tuition is those who skip classes and are about to be expelled from the university. The point is that such a measure will help such students value their studying and, perhaps, make them study better. That is why, in my opinion, the tuition should be raised but only for some students, and that is how it will help to raise the revenue level of the Nobody State University.
When the tuition is raised some students will not be able to pay such money and leave the university. The fewer students, the fewer professors the university needs. The decreasing of the amount of professor stuff will help the university to save money for their salary and raise the revenue.
The fall of the revenue
As it was mentioned above, when the tuition is raised, students will demand better living and studying conditions. When the tuition is raised, the university will have to pay more to the professors or to invite some from abroad or well-known American ones. This will cost money and the university will lose some income. Besides, some students will disagree to pay such money and leave the university, which will lover the income despite the raising of the tuition.
The universities of the United States of America always compete for the students. This means that if the university raises the tuition, there will be fewer students willing to study there. In some years, this will lead to the end of the university, because there will no teenagers that are able to pay such money. For such a university as the Nobody State University, increasing tuition while losing students will mean that the university will not survive and the revenue level will not increase, as the university authorities are planning it to be, but despite it will decrease until the university will not have a student to study and money for maintaining.
The revenue remains the same
The third option is that the revenue level neither raises nor falls; it remains the same. In my opinion, this might be the most realistic variant, because when the tuition is increased the income of the university remains the same. When the tuition is raised, the amount of taxes paid by the university will raise as well. The rest of the money that will remain after paying taxes will be paid to professors and for bettering living and studying conditions for students. As it has been explained above, the higher is the price of the education, the higher are the students’ demands to the level of education and the level of condition where they are studying in and living. Besides, the university will need to hire better professors and to invite specialists from all over the world to have lectures. In my opinion, it is almost impossible to leave the revenue the same while raising the tuition, because, according to the decision of the President of the Nobody State University, the revenue will either raise or fall. The point is that it is possible to make the revenue remain the same when some professors will be hired because in such cases the university will have the opportunity to raise the quality of studying and living conditions and to invite well-known professors and world-famous specialists.
The presented paper was aimed to show the consequences of raising the tuition and under what consequences the revenue will rise, fall and remain the same. It has been concluded that it is nearly impossible that the revenue remains the same because if the university is about to increase tuition, the level of education should be increased. This means that the university will have to invite foreign or local professors and specialists who will have lectures. Besides, the level of taxes will increase. When the tuition is raised, the President of the Nobody State University should understand that it is presumed that the revenue will fall. However, I would advise the President to increase tuition for international students and for those who are about to be expelled. Every university is striving to raise the revenue that is why the President of the university will want the consultant to help his university to survive in such a tough time.
On the other hand, if there were an opportunity, I would advise the President to involve private companies to help the university. Besides, the university may develop a plan that will help it to increase the level of revenue. The President of the university may ask private companies for sponsor help; that money will be put on inviting professors and bettering living and studying conditions. When the educational level of the university is increased, the President might increase the tuition. This means that the Nobody State University will have better conditions than other universities and its rate will increase as well. When the university rate is increased, the tuition is increased as well, and the university will get better revenue.