Gridiron University is a North Carolina state university that wants to attract both undergraduate and graduate students. Data suggest that undergraduate enrollment can be described by the equation:

Qu = 25,000 - Pu

where Qu = undergraduate enrollment and Pu = undergraduate tuition.

Graduate enrollment is given by:

Qg = 13,500 - 0.5Pg.

where Qg = graduate enrollment and Pg = graduate tuition.

a. If the goal of the university is to maximize total revenue, determine tuition, enrollment and demand elasticity for each type of student.

b. Because of a faltering state economy, the university anticipates budget cuts that will limit total enrollment to 11,000 students next year. If the University goal is to maximize total revenue, determine undergraduate and graduate tuition and enrollments.

c. Suppose that the marginal cost to the university of each additional student is $7,000. Determine the tuition charges if the university wishes to maximize profits. You may solve by trial and error or using Solver.