<p>dm2017, I agree that once a top university’s acceptance rate drops to 10%, the applicant numbers plateau, or increases at a snail’s pace. But Michigan (like Chicago before it and most other elite universities at one point or another, mostly in the 1990-2005) had acceptance rates in the 40%-50% rate, which means that top applicants saw it as a reasonable option to peer universities with much less reasonable acceptance rates (like Cornell, Northwestern, Penn etc…). As long as that is the case, students will apply at an annually increasing rate.</p>
<p>Once that trend begins, there are usually two waves. The first wave occurs between the time the university joins the common application and time its acceptance rate drops to under 30%. In that initial wave, the first year or two see(s) the largest leap in the number of applicants. The consequent years will see a more modest, but steady increase in applicants until the acceptance rate drops to under 30%. The second wave . This is happening as we speak. Michigan’s applicant pool increased by 8,000 from 30,000-38,000 in 2010, the year Michigan joined the common app. Since then, Michigan’s applicant pool has increased by 4,000 annually. 42,000 in 2011, 46,000 in 2012 and 50,000 in 2013. There is no sign of plateauing yet. I expect 53,000-54,000 applicants next year (2014), at which time the acceptance rate will drop to under 30%. </p>
<p>That is when the second wave will begin. It happened with most other elites 3-6 years after joining the common app, once their acceptance dropped below 30%. I expect the first year of the second wave (which is set to start in the fall of 2015) to see an increase in applications similar to the first year of joining the common app, from 53,000-54,000 in 2014 to well over 60,000 in 2015. That’s because of applicants will view Michigan as more desirable.</p>
<p>Another factor to consider is the inevitable rise in Michigan’s yield. Over the last 5 years, it has held stead at 39%-41%. But once the University’s acceptance rate drops below a certain point, many high school kids will associate the acceptance rate with exclusivity and the yield will start to rise. Furthermore, Michigan’s current $4 billion fundraising campaign is aimed at improving FA for OOS students, which should also improve the yield. I think Michigan’s yield will improve to 45% or perhaps even a little higher. </p>
<p>It should be noted that the increase in the applicant pool does not come from middle income applicants, but from wealthy OOS and international applicants. In fact, the vast majority of this increase in Michigan’s applicant pool has come from OOS and international applicants. As a result, you are going to see a continued trend of a declining in-state undergraduate students, from 70% in 2005 to 58% today to well under 50% in the near future.</p>
<p>Of course, all of this is speculation. You may be entirely correct and Michigan’s applicant pool may have indeed plateaued. We’ll know in the next 2 years or so.</p>