After adjusting for inflation, the average amount that full-time dependent undergraduates at public 2- and 4-year institutions and at private not-for-profit 4-year institutions were charged for tuition and fees was higher in 2000 than in 1990. These higher prices, combined with a reduced expected family contribution for low- and middle-income students and their families, meant that the amount of need-based financial aid for which the average student was eligible was greater in 2000 than in 1990.

Financial aid patterns for full-time dependent undergraduates changed during the decade as well. The percentage receiving aid and the average amount that aided students received (adjusted for inflation) increased for all income groups and at all types of institutions. These increases represent both increased grant aid and increased borrowing.

Grant aid reduces the price of attending because it does not have to be repaid. The percentages of students receiving grants and the average amounts received by students with grant aid increased for all income groups and for students at public 2- and 4-year institutions and at private not-for-profit 4-year institutions. The average net price after grants increased at each type of institution. The average net price after grants appeared to increase for all income groups, although the increases were not statistically significant for students in the lowest income quarter at public 2-year or at private for-profit less-than-4-year institutions. The increases in net price after grants between 1990 and 2000 mean that the increases in grant aid were not enough to offset the price increases during this decade.

Loans reduce the current outlay required to cover educational expenses and thus increase access to postsecondary education. However, because they must be repaid, they do not reduce the price of attending, but simply postpone paying part of it. The percentage of full-time dependent students who borrowed to pay their educational expenses increased from 30 percent in 1990 to 45 percent in 2000. The percentage who borrowed increased for all income quarters except the lowest. By 2000, about half of the students in the lowest, lower middle-, and upper middle-income quarters and 35 percent of those in the highest income quarter borrowed. The average amounts borrowed by each income group were higher in 2000 than in 1990. The increases in borrowing between 1990 and 2000 reflect not only the need to cover price increases not covered by increases in grant aid but also wider eligibility for subsidized loans, the introduction of unsubsidized loans not tied to need, and higher loan limits. Students who were not permitted to participate in federal loan programs in 1990 were allowed to do so in 2000, and everyone was allowed to borrow more.

The combined result of increases in price, grants, and loans was that the average net price after grants and loans increased for some full-time dependent students and decreased for others: it increased for those at public 2-year institutions, remained stable for those at 4-year institutions, and declined for those at private for-profit less-than-4-year institutions. Within type of institution, the effect varied by income. Average net price after grants and loans declined for low-income students except at public 2-year institutions and increased for high-income students at public 2- and 4-year institutions.