The Student Housing Decision

Abstract

This case provides a realistic application of inflation-adjusted capital budgeting in a university setting. The case is designed for use in an upper-division cost accounting course or a graduate level cost/managerial accounting class. Students are required to analyze the costs of building and operating a student apartment complex, to determine a reasonable rental rate for three types of apartments, and to make a recommendation about the feasibility of the project. Critical thinking is emphasized in the development and interpretation of the present value (PV) model, identification and discussion of qualitative issues, and recognition and inclusion of uncertainty.

This case was prepared for inclusion in Sage Business Cases primarily as a basis for classroom discussion or self-study, and is not meant to illustrate either effective or ineffective management styles. Nothing herein shall be deemed to be an endorsement of any kind. This case is for scholarly, educational, or personal use only within your university, and cannot be forwarded outside the university or used for other commercial purposes.

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