When colleges use yield management techniques, they increase financial aid offers to students likely to be more price sensitive and they reduce financial aid offers to students likely to be less price sensitive.

Question

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Yield management techniques aim to maximize revenue by adjusting prices and availability based on customer behavior. In the context of college admissions, this means adjusting financial aid offers to appeal to students who are more likely to accept the offer based on cost. By increasing financial aid offers to price-sensitive students, colleges can increase their yield (the percentage of accepted students who enroll), while reducing aid offers to students who are less price sensitive can help control costs.

When Colleges Use Yield Management Techniques, They Increase Financial Aid