Type of ingredient

Management (ongoing)
Manager
Management support
Total recurrent management costs
Development
Management (development)
Manager
Mannagement support
Development course material
Study guide
Content development
Layout & design
Podcasts
Content development
Editing
Syllabus
Discussion prompts
Assignments
Total development costs
Maintenance
Content development
Layout & design
Total maintenance costs
Total fixed costs
Delivery
Online discussion (G=25)***
Marking assignments
Essay
Spreadsheet
Collaborative assignment
Printing costs
Postage
Total variable cost per student
Income
***Note that ac. participation in online
discussion is a semi-variable cost

Course management
Course management support

Course management
Course management support
1 study guide @ 150 pages
academic time
professional time
5 podcasts
academic time
professional time
academic time
academic time
academic time

academic time
professional time

academic time
academic time
academic time
academic time
1 study guide @ 150 pages
1 study guide @ 150 pages

Unit

# units

cost/unit

cost

annual salary
annual salary

0.5
0.5

70,000 USD
40,000 USD

35,000 USD
20,000 USD
55,000 USD R

0.5 of an annual sala

0.5 of the time of a P

annual salary
annual salary

0.2
0.8

70,000 USD
40,000 USD

14,000 USD
32,000 USD

manager who invest

personal assistant w

hours
hours

50
10

30 USD
20 USD

1,500 USD
200 USD

1 h academic time is
It is assumed that
professional designe

hours
hours
hours
hours
hours

20
10
10
50
9

30
20
30
30
30

USD
USD
USD
USD
USD

600
200
300
1,500
270
50,570

USD
USD
USD
USD
USD
USD FD

20 h of academic tim
professional designe
10 h of academic tim
50 h of academic tim
9 h of academic time
SUM(Management+D

hours
hours

20
5

30 USD
20 USD

600
100
700
51,970

USD
USD
USD FM
USD F

20 h of academic tim
5 h of professional ti
SUM(CD+L&D)
(SUM(Management+

hours

150

30 USD

hours
hours
hours

0.5
0.667
0.5
1
1

per credit point

30
30
30
5
3

USD
USD
USD
USD
USD

280 USD

180 USD
15
20
15
5
3
238.01
840

USD
USD
USD
USD
USD
USD V
USD SF

(SUM(150 h of acade

one essay, which req

spreadsheet assignm
collaborative assignm
The printing costs ar
Postage is rated with
Sum (Delivery)

.5 of an annual salary of a course manager at $70000

.5 of the time of a PA at an annual salary of $40000

manager who invests .2 of his/her time for the course during the year of development
ersonal assistant who works 0.8 of his/her time for developing the course

h academic time is rated here as 30 USD / 1 h professional time is rated at 20 USD

is assumed that 50 h of academic time
rofessional designer requires 10 h

0 h of academic time
rofessional designer requires 10 h
0 h of academic time
0 h of academic time
h of academic time
UM(Management+DCM+Maint)

0 h of academic time will be needed for course maintenance

h of professional time
UM(CD+L&D)
SUM(Management+DCM+Maint))+(SUM(CD+L&D))

SUM(150 h of academic time)X(Aced Hours / G (25))

ne essay, which requires about 30 min 30/60=.5

preadsheet assignment requires 40 min 40/60=.667
ollaborative assignment is the most complex and requires about 2.5 h per group of 5 students 2.5/5=.5
he printing costs are 5USD
ostage is rated with 3USD per student
um (Delivery)

ents 2.5/5=.5

Year 1
# students per annum
Number of students (Accumulating)
Recurrent management costs
Fixed costs of
development
maintenance

100
100
55,000 USD

55,000 USD
50,570 USD
700 USD

$7,224.29
140 USD

$7,224.29
62,224 USD

Annualized fixed costs of

development
maintenance
Total fixed costs (F)
Variable costs (V)
Total Cost
AC
Income per student (IPS)
Total income (I)
Income - cost
Break Even Point

50,570 USD
700 USD

7,814 USD
108 USD

238 USD
F+(V*N)
F/(N+V)
840 USD
IPS*Acc# Students
F/(IPS-V)

7,814 USD
62,814 USD
440,020 USD
238 USD
$463,821.16
$4,638.21
840 USD
84,000 USD
-379,821 USD
731

Input
Input
Input

Result

Year 2

Year 3

Year 4

Year 5

Year 6

100
200
55,000 USD

100
300
55,000 USD

100
400
55,000 USD

100
500
55,000 USD

100
600
55,000 USD

$7,224.29

$7,224.29

$7,224.29

62,224 USD

62,224 USD

62,224 USD

$7,224.29
140 USD
62,364 USD

$7,224.29
140 USD
62,364 USD

7,814 USD

7,814 USD

7,814 USD

7,814 USD
108 USD
62,922 USD
440,020 USD
238 USD
$559,025.16
$1,118.05
840 USD
420,000 USD
-139,025 USD

7,814 USD
108 USD
62,922 USD
440,020 USD
238 USD
$582,826.16
$971.38
840 USD
504,000 USD
-78,826 USD

62,814 USD
440,020 USD
238 USD
$487,622.16
$2,438.11
840 USD
168,000 USD
-319,622 USD

r
n
C
(1+r)
(1+r) n
a(r,n)
C*a(r,n)

62,814 USD
62,814 USD
440,020 USD 440,020 USD
238 USD
238 USD
$511,423.16 $535,224.16
$1,704.74
$1,338.06
840 USD
840 USD
252,000 USD 336,000 USD
-259,423 USD -199,224 USD

Annualization
rate
years
amount
(Intermediate value)
Annualization factor
Annualized amount

2.0%
7
50570
1.0200
1.1487
0.155
7814

Year 7
100
700
55,000 USD
$7,224.29
140 USD
62,364 USD
7,814 USD
108 USD
62,922 USD
440,020 USD
238 USD
$606,627.16
$866.61
840 USD
588,000 USD
-18,627 USD

number of students the course is supposed to draw per annum:

435,990 USD

440,020 USD

to draw per annum: 100.

Total Cost
700,000 USD

600,000 USD

500,000 USD

400,000 USD

300,000 USD

200,000 USD

100,000 USD

0 USD
100

200

300
Total Cost

400Total income
500
(I)

300
Total Cost

Total Cost

400Total income
500
(I)

600

700

Variable Cost

5,000 USD

4,500 USD

4,000 USD

3,500 USD

3,000 USD

2,500 USD

2,000 USD

1,500 USD

1,000 USD

500 USD

0 USD
100

200

300

400

500

Variable Cost

Variable
costs (V)

AC

400

500

600

700