ABSTRACT
This chapter identifies some of the fundamental variables affecting costs for at least one type of large-scale distance-learning system—that akin to the British Open University. Appropriate cost variables are gathered together in the form of simple cost-function equations or, briefly, cost functions. The costs of preparing course materials can escalate alarmingly, way beyond the financial resources provided, and the resources which are marshalled may be critically insufficient in kind, amount and timing, with consequentially serious implications for the distance-teaching institution. In terms of recurrent costs the latter component is a function of the cost of employing suitable people and of their production or creation rates. For forecasting purposes it is usual to assume an average creation rate obtained from practical experience. There is pressing need for suitable cost functions to be developed to enable planners, decision-makers and accountants to forecast budgetary requirements with a reasonable degree of accuracy.
