And yet acceptance rates at top schools have been consistently going down.
It’s the same thing as the job application problem. When it is as easy as having a form autofilled and hitting submit (even if there is a moderate fee), you throw shit at the wall to see what sticks.
Obviously top rated stuff has high demand and low supply. Further if students are finding lower rank universities less worth the money, many of them would try even harder to get in higher ranked ones.
That's correct and to some extent it's had a deleterious effect on education. The primary problem however is that money—the finances of education—has become as important or even more so than education itself. 50 years ago education had more intrinsic worth that it does today. Well, anyway, it did with those who controlled the politics and thus the pursestrings.