It's a smart move. I started using a Mac as a student in 2007 with a cheap Mac Mini and then I was so enthusiastic that I also got the white plastic MacBook, so that I could use Mac at the university.
Since then I have bought countless MacBooks and some other models (I like to refresh every 1-3 years and then my old model typically gets passed along to other family members).
Trying to get students to use your product is a good strategy.
Also, people tend to mix pricing increases with inflation. When I my first iPhone 3G, it cost 500-700 Euro if you were able to get your hands on one without a subscription (remember when iPhones were provider-exclusive?) [1]
An inflation calculator for my country tells that this is 753-1054 in current Euros. The iPhone 17 is now sold here for 839 Euro new. Same ballpark.
[1] https://www.iculture.nl/nieuws/iphone-3g-als-los-toestel-87-...
My first Mac was the same white plastic one, I think it was called the iBook back then? Cost me the majority of my summer job earnings going into freshman year, but it was a great machine for me back then! I still have it in a box somewhere in the basement, might be fun pull it out and resurrect it :)