[Loughla]

>tuition cost = how much you can borrow + how much you can pay

I need this flushed out a little bit more. I have worked in higher ed for decades, and have never encountered a college that charges in that manner. They have a flat tuition, and the student fills that payment however they are able. But it's not like it changes based on how much capital they have access to.

Can you please explain that statement?

[jefftk]

It sounds to me like your parent is describing financial aid at high end colleges. The college has a sticker price, say $50k/y, and for people that can't afford it they have need-based financial aid. They ask you lots of details about your family's income and assets, and come up with a number that they think is the most you can pay.

It's price discrimination, in that it's charging people in proportion to what they can pay.

[apta]

Are you referring to the loan-based "financial aid"? This is one of the most hypocritical terms I came across. It's a loan, not an aid. An aid would directly reduce the amount of money you have to pay (discounts, scholarships, grants, etc.). A loan is not an "aid".

[jefftk]

I'm primarily talking about grants, not loans, since that's where the price discrimination is clearest. They're effectively setting the price at exactly what they calculate you can pay.

[big_chungus]

No, the generous "financial aid" policies of many universities amount to perfect price discrimination. They meet "one hundred percent of demonstrated need"; their phrase, not mine. This means they calculate how much you can afford to pay and charge you that much. That' is every monopolist's/oligopolist's dream. Oh, and they don't show how they calculate that "demonstrated need". I got prices much higher than what I could afford.

[KptMarchewa]

It's not on the level of individual student, but overall market. As ability of whole group of students to pay goes up, the price also goes up.

[theseatoms]

Just wait until Uncle Sam foots the bill directly.

He has quite the "ability to pay".

[bcassedy]

Right, but he also then has a lot more incentive to keep costs down and the power to enforce some requirements and controls to keep costs down.

[CamperBob2]

Seems to work OK in every other civilized country on Earth.