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<p>this is only categorically true when financial aid expenditures are included as an institutional expense. a full pay student at a poorly or moderately endowed (say, less than $100,000 per student) private school that does not generate significant research grant dollars is likely paying more for his education than the school is spending on all operations (including things like fund raising) per student. simply, the schools financial/merit aid budget is likely larger than its spendable endowment income, current operations giving, and research/government grant support combined.</p>
<p>obviously, this caveat does not apply to usc. so to answer the question, usc charges $50,000 per year because that is what virtually every other top private college in the country charges. charge more than your peers and you stick out as an unaffordable sore thumb (that has the audacity to charge much more than harvard or stanford). charge less and, in addition to losing out on tuition revenue, people will think that you do not provide an education on par with colleges charging more. its tacit market collusion.</p>