Another factor driving these numbers that hasn't been brought up is the sleight-of-hand merit award that isn't a discount at all. For example, a tuition of $40k one year might change to $45k the next year, with many $3k merit awards given by the institution to qualified applicants (where "qualified" equals "just about everyone they accept who wasn't getting a full ride for other reasons").

The institution that does this not only sees more revenue per student, but they also drive higher demand, because students and parents are enamored of winning the scholarship "prize."