<p>Supply and demand? Sure, to some extend as education is a marketplace. But it is not like Umich is throwing off a profit that they are not directly reinvesting. Have you been to the campus? The costs to keep the quality of those facilities, let alone the quality of the professional staff is emmense. Additionally and obviously, any $ they get from OOS lessens the IS burden. </p>
<p>The pricing is undoubtly a careful balancing act of IS burden, diversity and quality of OOS students you are trying to attract and meeting the mission of a world class (in all regards) institution of higher learning. </p>
<p>With a decreasing acceptance rate, they could undoubtly charge more. But, that could lessen the student quality which would ultimately lead to less demand of the product, starting a pricing cycle. </p>
<p>You must be arguing that Michigan could get by with a lower price hence, they are wasting a lot of money by overpaying the professionals and/or overspending on facilities. Otherwise, where do you think the $ is going?</p>