(Here comes my Economixxx talking)
The Price Elasticity on Demand of a good degree from a good uni (such as Exeter), is highly inelastic - meaning that, as price increases, the demand for such product (here, the degree) doesn't fall that dramatically.
If you think about it, if you want to be earning big money, or go into your dream job, it is highly likely that you will need a good degree to do so. It is very unlikely that the vast majority of people will say "oh no, I want to be barrister but now I have to borrow a bit more money, I think I'll work in McDonald's for the rest of my life".
However, I can imagine that people taking pointless degrees or/and at very poorly ranked universities, or people just going to get drunk and have a good time, will probably consider progressing elsewhere with their careers. That is where the majority of the reduction in applicants will come from. Bath, Warwick, Oxford and Cambridge all have had more applicants so far this year, than last year.
Also on Radio 2 they were comparing it with last year, which was likely to have a hell of a lot more people applying then this year; people will take gap years after uni rather than before to save money. So of course, there is going to be a reduction anyway.
(This is just my take on it, I welcome other's opinions
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