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Would you expect the price elasticity of demand to be higher at the level of an individual school or at the aggregate level (e.g., all 4-year colleges and universities)? Why? Despite the empirical evidence to the contrary, college decision-makers often believe that their price elasticity of demand is essentially zero. Is that right? How important were price considerations in making your college decision? Would a change of a few thousand dollars have mattered? Would you expect the price elasticity of demand to be higher for financial-aid students or for non-aid students? Why? How does a student’s income elasticity affect the demand for higher education at College?

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