Where did you get that the author was discussing tuition as a percentage of overall budget? Additionally, he was was discussing GIA, which includes substantially more cost than tuition, as he puts it, "the full, zero-financial-aid price of attending the school, getting room and board, and getting all required books". And in fairness to the author, he stated the actual cost is dependent upon a number of things, and varies by school, major and even individual student. The only real exception is if the school has zero capacity and there is a real cost of opportunity. Scholarship money is real, but the true cost can be substantially less. How this all gets portrayed and presented is another story.
Just like you, the parent company of a dance studio has determined that 50 students will enable it to meet their revenue and profit goals (or "break even" if it's a nonprofit). They have capacity to accommodate 10 more kids. For every kid they add above 50, how much additional cost is there and what does the gross margin of these additional students look like? It's pretty good. Additionally, the parent company tells the instructor she'll get a bonus for every student over 50 that signs up for her class (they can afford to, a chunk of their tuition is going straight to the bottom line). Now let's say that same dance studio decides it wants to give two talented kids a spot for free, they might choose to set their goal at 52 students. Or, lets say the school can accommodate only 50 students, but want to add the 2 talented students because it will ultimately drive business for their other programs or allow them to expand and add more classes, there is indeed a cost of opportunity, but one could argue that's it's really an investment in future growth.
