Question

In: Finance

Cindy, who will graduate from college in a year is deciding whether to go on for...

Cindy, who will graduate from college in a year is deciding whether to go on for her master’s degree which will last two years. She figures that if she takes a job immediately, she can earn $40,000 per year in real terms for the remainder of her working years. If she goes on for two more years of graduate study, however, she can increase her earnings to $50,000 per year. The cost of tuition is $40,000 per year in real terms. Is this a worthwhile investment if the real interest rate is 5% per year?—(Assume she will retire after working for 40 years. AND SHOW YOUR WORK)—4 pts.

Solutions

Expert Solution

please find attached answer

jeff jeffy answered 1 year ago
Next > < Previous

Related Solutions

Cindy, who will graduate from college in a year is deciding whether to go on for...
Cindy, who will graduate from college in a year is deciding whether to go on for her master’s degree which will last two years. She figures that if she takes a job immediately, she can earn $40,000 per year in real terms for the remainder of her working years. If she goes on for two more years of graduate study, however, she can increase her earnings to $50,000 per year. The cost of tuition is $40,000 per year in real...
Ying-Ru is beginning her senior year of college soccer and is deciding whether or not to...
Ying-Ru is beginning her senior year of college soccer and is deciding whether or not to buy insurance in case she is injured. There is a 50% chance she will not be injured and a 50% chance she will be. If she is not injured, she will received a $400 contract to play professionally. If she is injured, she will receive a $100 contract to carry water bottles. (b) Insurance policy A will pay Ying-Ru $300 if she gets injured,...
It has been determined, with 90% confidence, that the proportion of students who graduate from college...
It has been determined, with 90% confidence, that the proportion of students who graduate from college are able to find a job in their field of study lies between 64% and 83%. Using this information answer the following questions. What is the sample proportion? What is the margin of error? Interpret this confidence interval in the context of this problem. ​​​​​​​​​​​​​​What would happen to this interval if the confidence level were to increase to 95%?
A risk-neutral plaintiff in a lawsuit is deciding whether to settle a claim or go to...
A risk-neutral plaintiff in a lawsuit is deciding whether to settle a claim or go to trial. The defendants have offered a $150,000 settlement. If the plaintiff does not settle, she believes that the probability of winning at trial is 75%. If the plaintiff wins, she is awarded X dollars. If she loses her payoff is $0. How large must X be in order for the plaintiff to turn down the settlement offer? Suppose instead that the plaintiff is risk-averse,...
A study of 50 randomly selected students from a particular college who did not go to...
A study of 50 randomly selected students from a particular college who did not go to the campus Learning Center for statistics tutoring had a mean overall grade (at the end of the semester) of 68.41% with a standard deviation of 9.60%. The same study also found that 48 randomly selected students who did take advantage of the tutoring at the campus Learning Center had a mean overall grade of 79.25% with a standard deviation of 8.71%. The standard deviation...
At a local high school 80% of students who enter as freshmen go on to graduate....
At a local high school 80% of students who enter as freshmen go on to graduate. 20 freshmen are randomly selected. a. What is the probability that at most 12 students will go on to graduate? Round your answer to 4 decimal places. b. What is the probability that at at least 15 students will go on to graduate? Round your answer to 4 decimal places. c. What is the probability that at least 12 and no more than 16...
4.​A family is deciding whether to send the oldest child to college. The family expects that...
4.​A family is deciding whether to send the oldest child to college. The family expects that the college education will mean 1.6 times more income per year than if the child does not go to college. College will cost $100,000 (assume that all costs occur in one year). If the income of someone not going to college is $30,000 per year, how long would it take for the $100,000 investment to be paid back in extra earnings, assuming an interest...
Medications are quite effective for ADHD symptoms. What considerations should go into deciding whether or not...
Medications are quite effective for ADHD symptoms. What considerations should go into deciding whether or not to prescribe these for a child with ADHD? What are the concerns related to prescription?
Abby is debating whether she should take a big loan to go to a graduate school...
Abby is debating whether she should take a big loan to go to a graduate school or continue whit their daily boring job. which type of motivational conflict does abby experience above? How can graduate schools helps people like abby to resolve their motivational conflict to enroll in graduate programs . please list two different stratergies focusing on different aspects?
You are trying to decide whether to take a job after you graduate or go onto...
You are trying to decide whether to take a job after you graduate or go onto graduate school. Consider the following questions as you make your decision. A. Which of these costs, for the most part, would be relevant (R), and which would be irrelevant (IR)? ◦ Cost of your undergraduate education ◦ Salary with an undergraduate degree ◦ Salary with both an undergraduate degree and a graduate degree ◦ Rent ◦ Car Insurance ◦ Graduate school tuition and fees...
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT