Cost Structures in Education Flashcards
What are capital costs?
Durable assets
What is the opposite to variable costs?
Fixed Costs
What are the 8 different types of cost?
Recurrent Capital Direct Indirect Variable Fixed Average Total
Who defines average and marginal costs?
Maureen Woodhall (1987)
Berne and Stiefel (1995) say cost information can be used in three ways…
- To look at the production function - relationship between inputs and attainment
- Resource effectiveness
- Cost effectiveness
Maureen Woodhall (1987) defines what types of costs?
Average and marginal
Who said cost information can be used in these three ways…
- To look at the production function - relationship between inputs and attainment
- Resource effectiveness
- Cost effectiveness
Berne and Stiefel (1995)
What are variable costs?
Costs that may have to be increased depending on number e.g. staff salaries
Why does Simkins (2000) say effective cost management is necessary?
- Public resources for education are scarce.
- The trend towards self-managing schools means schools must have full information about what they are using.
- Helps ensure value for money
What is the average cost?
Cost per student
Who said this is necessary for effective cost management:
- Public resources for education are scarce.
- The trend towards self-managing schools means schools must have full information about what they are using.
- Helps ensure value for money
Simkins (2000)
Maureen Woodhall (1987) mentions two ways of measuring opportunity cost
- Individual or private cost
2. Societal or social cost (incurred by the community)
What is Simkins context?
British
What are sunk costs?
Costs that are incurrent to take advantage of an opportunity.
Between what types of consciousness does Simkins (2000) differentiate?
Budget consciousness and cost consciousness
What are the four key principles of assessing value for money?
- Comparing to similar schools
- Challenge whether the performance is high enough
- Secure efficient and effective services
- Check the views of stakeholders are recognised
What is the opposite to recurrent costs?
Capital costs
How did the UK Audit Commission (1984) define value for money?
Both efficient and effective
What are recurrent costs?
Costs that occur year on year
What are fixed costs?
Costs which have to be met irrespective of the number of students e.g. admin staff
Why might average and marginal costs vary?
Depending on whether the cost are fixed of variable
What is cost consciousness?
Full awareness of the alternatives forgone
Who differentiates between budget consciousness and cost consciousness?
Simkins (2000)
What was Berne and Stiefel’s context?
Writing with regards to USA but universally applicable.
Who measures opportunity cost in these two ways?
- Individual or private cost
- Societal or social cost (incurred by the community)
Maureen Woodhall (1987)
What Is Woodhall’s context?
British but applicable universally
How does Maureen Woodhall (1987) define marginal costs?
Additional costs which may be incurred when another student is enrolled
What is budget consciousness?
Awareness of the financial implications of an activity of decision
What are direct costs?
Costs applicable to a particular course, for example e.g. the cost of running Science
What are indirect costs?
Costs that are needed whether there are students or not e.g. admin staff
What are opportunity costs?
The alternative opportunities that are given up to spend funds in a particular way.
What is the opposite to direct costs?
Indirect costs
