You have a job in a company that pays you P350,000 per year. For a better future, you want to get a Master's degree that could cost P100,000 but cannot continue your job while studying. If you decide to give up your job and return to school to earn a Master's degree
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You have a job in a company that pays you P350,000 per year. For a better future, you want to get a Master's degree that could cost P100,000 but cannot continue your job while studying. If you decide to give up your job and return to school to earn a Master's degree, how much would be your opportunity cost?
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- Suppose that, at age 30, you might wish to leave your job and pursue a master’s degree. If you choose to remain at your job, your employer would pay you $74k per year until retirement, at age 55. If you go back to the university, you would have to sacrifice 2 years of income, but once you graduate, you would receive $117k per year until you retire at age 55. The master’s program you are interested in costs $22k per year. Note: The term “k” is used to represent thousands (× $1,000). Required: At an opportunity cost of 8%, determine the percentage difference between your most and least profitable alternatives, with the least profitable option as the basis for your calculation.Answer% Intermediate calculations must be rounded to 3 decimal places (at least). Input your answer as a percent rounded to 2 decimal places (for example: 28.31%).Suppose that you decide to go to summer school. Your tuition cost is $3,000, books and supplies cost $300, and room and board cost $1,000. You would not work while you attend summer school. If you did not go to summer school you would take a summer job which earns you $5,000 for the summer and your cost of room and board in the summer would be $2,000. Considering only this information, what is the dollar value of your total opportunity cost of attending summer school?Jenny Jenks has researched the financial pros and cons of entering into a 1-year MBA program at her state university. The tuition and needed books for a master's program will have an upfront cost of $51,000. If she enrolls in an MBA program, Jenny will quit her current job, which pays $50,000 per year after taxes (for simplicity, treat any lost earnings as part of the upfront cost). On average, a person with an MBA degree earns an extra $21,000 per year (after taxes) over a business career of 39 years. Jenny believes that her opportunity cost of capital is 5.3%. Given herestimates, find the net present value (NPV) of entering this MBA program. Are the benefits of further education worth the associated costs? The net present value (NPV) of entering this MBA program is Are the benefits of further education worth the associated costs?
- 1. Jackie has just finished high school. She will live for two more periods, and she needs to choose a career path. She can either take a job right now as an Uber driver $28,000 in each of the two periods. Or she can get more education in period one to become an economist. Tuition in the first period would be $25,000 and she would earn $85,000 in the second period with her economics degree. a) Suppose the discount rate is 5% (r=.05). If Jackie wants to maximize the present value of her lifetime income, what should she do? Explain and show your calculations. b) Suppose the discount rate is 10% (r= .10). What should Jackie do? Explain and show your calculations c) Suppose the discount rate is 5% but suppose tuition costs are $30,000. What should Jackie do? Explain and show your calculations.Maria has a choice between two job offers. The first is in Ithaca and pays $55,000.00 annually. The second job is in Memphis and has a base pay of $45,000.00 with a 10.00% chance of earning an annual bonus of $20,000.00. In which city will Maria, a risk-neutral person, work if the selection is based only on earnings? Ithaca Part 2 ( Feedback See Hint Maria would be indifferent between these two offers if the probability of obtaining the bonus was 0.5 %. (Round to the nearest percent.)You have chosen biology as your college major because you would like to be a medical doctor. however, you find that the probability of being accepted to medical school is about 20 percent. if you are accepted to medical school, then your starting salary when you graduate will be $260,000 per year. however, if you are not accepted, then you would choose to work in a zoo, where you will earn $30,000 per year. without considering the additional years you would spend in school if you study medicine or the time value of money. What is your expected starting salary? WHat is the standard deviation of that starting salary?
- 1. Josh is not sure if he should attend college or not. Part of his decision will be based on the return on investment of college. He estimates that the per year cost to attend Texas Tech including room and board is $27,750. He also assumes the cost will rise by 5.5% per year. How much is a 4 year degree going to cost Josh? A. Josh recognizes that not only will he have the costs of attending school, but he will also be giving up a salary while he attends school. He figures the average salary for those with only a high school diploma is $30,000. He assumes he would receive a 2.4% cost of living raise each year. Determine how much money he will forgo while attending school. B. If Josh adds the cost of college with the salary he will forgo by attending college, he finds it will cost: in total. (Keep in mind that this does not include any interest on loans needed to pay for school.) C. To help him determine if it really is worth it to get a college education, Josh wants to see what the…You have chosen biology as your college major because you would like to be a medical doctor. However, you find that the probability of being accepted to medical school is about 20 percent. If you are accepted to medical school, then your starting salary when you graduate will be $320,000 per year. However, if you are not accepted, then you would choose to work in a zoo, where you will earn $46,000 per year. Without considering the additional years you would spend in school if you study medicine or the time value of money. Problem 7.03 a1-a2(a1) Your answer is correct. What is your expected starting salary? Expected starting salary $ eTextbook and Media Problem 7.03 a1-a2(a2) LA Your answer is incorrect. Standard deviation $ 100800 What is the standard deviation of that starting salary? Attempts: 1 of 3 usedAllison is contemplating a job offer with an advertising agency where she will make $54 000 in her first year of employment. Alternatively, Allison can begin to work in her father's business where she will earn an annual salary of $38 000. If Allison decides to work with her father, the opportunity cost would be?
- If the price of attending Big Benefits University is $8,000 a year for tuition, fees, books, and and $25,000 in foregone earnings, what is the marginal cost of attending, if it takes you 5 years to graduate, and you assume a 3% annual inflation rate? If the average college graduate makes $38,000 more every year than the average high school graduate, what is the cumulative marginal benefit of a college education if the average college graduate works for 40 years, assuming a 3% inflation rate? c.In this scenario does it make sense to go to college, explain your answer.You currently pay $10,000 per year in rent to a landlord for a $100,000 house, which you are considering purchasing. You can qualify for a loan of $80,000 at 9% if you put $20,000 down on the house. To raise money for the down payment, you would have to liquidate stock earning you a 15% return. We neglect other concerns, like closing costs, capital gains, and tax consequences of owning. Given the described situation, determine whether it is better to rent or own.3. Suppose a high schools graduate earns $40,000 per year while a college graduate makes $80,000. Assume these wages will not change over time, and there are no other benefits to going to college. Explicit costs of going to college (tuition, books, supplies, etc.) are $30,000 per year. Ignore the psychic costs. The college education lasts four years. The retirement age is 65. a. Say an 18 year-old decides to obtain college education. What can her annual discount rate be? b. Say a 40 year-old has a discount rate of 5%. Will this person go to college?