Until 1993 Carleton College, in Northfield, Minnesota, did not take a student’s ability to pay tuition and living expenses into account in making admissions decisions. That year, however, Carleton changed its policy. It adopted a system, now used by numerous other colleges and universities, under which the college admits as many students without looking at need as its financial aid budget allows, offering these students enough money to attend. When the aid budget is exhausted Carleton then only admits students who need a grant of $2,000 or less to pay the $25,610 that, at this time, a person needs to cover tuition and living expense costs at Carleton. Under this policy, Carleton took a student’s ability to pay into account for the final 5% of admitted students in 1994, and for the final 9% in 1995 and 1996. At the time Carleton changed its policy the financial aid budget comprised one fifth of the school’s annual expenditures, and the budget for financial aid had increased 38% from the previous year.

Is Carleton’s policy fair or unfair? Explain your answer.