Definitely. You young dudes are way ahead of the curve. When I was 20 in undergrad, I thought I was cool in my SB Dunks and The 100s t shirts. I did not even own a suit until I was in grad school and had professional job.
I would definitely buy the cheaper stuff. You're in undergrad, your body may change and/or you may get beer, food, etc. spilled onto the clothes. Fast fashion brands like H&M and Uniqlo should be your best friend.
For a suit, I would go with a navy or gray (either light or dark would be fine). The colors are versatile and you can wear the pieces as separates. If you want another pair of dress trousers, go with the color you didn't get the suit in, so if you got a navy suit, get grey trousers and vice versa. I think you can get a full suit from H&M for around $150 or less. I bought a blazer from them before at around $70, and dress trousers for around $40 or so. Granted this was maybe 4 years ago, but prices shouldn't have jumped severely.
For shirts, white and light blue are staples. If you want a pattern, go with a simple blue stripe or gingham.
For shoes, go with something cheap for now. Those boots Serg and others posted from JC Penney look great. I would also get a pair of desert boots, you can wear them with suits. 2 pairs would be ample at this point for you.
Everything I talked about so far should be under the $750 line which gives you a little leftover to buy a couple of belts and ties. You can get belts and ties from Macy's, and utilize the coupons that are always available.
Just make sure the stuff you buy fits you properly, that's the key. And wear with confidence, my young friend.
EDIT: As you get more money in, if you want to continue building your wardrobe, I would consider several things:
1. finer footwear. Get shoes that are Goodyear Welt like Allen Edmonds, which can be bought on sale. Assuming you do not gain a lot of weight forcing your feet to get bigger, you can wear them for a decade easily with several repairs. Goodyear Welt allows for the shoe repair shop to change the sole as they wear out. This can be done 5-7 times until the shoes 'die' completely. You will need to do this about 1 year max, assuming you walk crazy distance in them.
2. adding more shirts to your collection. I wouldn't go above J. Crew's level at your stage.
3. get some knitwear ie cardigan and sweater to wear in lieu of a jacket.
4. save some money and enjoy, man. It's college....suppose to be an enjoyable time. Use your money to go out on dates and hang out with friends. You don't get winter and summer breaks anymore in the real world, just 2 weeks off a year.