Write a 2-3 paragraph paper evaluating the lifetime NPV of yourcollege degree and post to the...

Write a 2-3 paragraph paper evaluating the lifetime NPV of yourcollege degree and post to the discussion board

Solutions

Expert Solution

My college degree provides me with several benefits and the primary benefits of my college degree are - higher starting annual salary, higher wage growth, higher benefits, lower unemployment rate, higher labor force participation rate, and lower occupation absence rate. I am a 25 year old male and have a bachelor’s degree in finance and accounting. With a retirement age of 65 years I have around 40 years of work career ahead of me during which I will earn salary and bonuses. My starting salary is $50,000 that I am earning currently and this is expected to grow by 10% per year. Also my cost of capital is 12% and my cost of education stands at $120,000.

Thus the present value of my costs = $120,000 and the present value of my future earnings in the form of salary will be computed using the formula: P/(r-g) * [1-((1+g)/(1+r))^n] where P = $50,000, r = 12%, g = 10% and n = 40 years. Thus present value of all my future earnings = 50,000/(0.12-0.10)*[1-((1+0.10)/(1+0.12))^40 = $1,284,020. Thus the lifetime NPV of my college degree is NPV of benefits – NPV of costs = $1,284,020 - $50,000 = $1,234,020.

(2 paragraphs)

jeff jeffy answered 6 months ago

Next > < Previous

Related Solutions

Find a blog that presents and defends an argument within the post. Write a paragraph evaluating...

Find a blog that presents and defends an argument within the post. Write a paragraph evaluating the arguments as either inductive or deductive. Provide the blog link in your paragraph response. Why do you think identifying these different elements are important?

You are to write a paper about evaluating sources. The paper is to be single spaced...

You are to write a paper about evaluating sources. The paper is to be single spaced in 12-point Times New Roman font with 1” margins and at least one page long but not to exceed four pages. Answer the following questions or discuss the following items in your paper: 1. What’s the point? Why should anyone care about the validity of sources? 2. Discuss methods for evaluating sources. Are there different methods for different types of sources? 3. What is...

Please post a 2 to 3 page reflection paper here on EITHER the topic of "Crime"...

Please post a 2 to 3 page reflection paper here on EITHER the topic of "Crime" or the topic of "Gender", with a social problems focus. You may not restate what you wrote about in the discussion forums. It must be 2-3 FULL pages (from the top of the first page to at least the very bottom of the second page). Formatting: 12 pt. Times New Roman, double-spaced evenly throughout. Please just put your heading, name, and date in the...

Do you NANDA? NOC and NIC Linkages. Write a 1-2 paragraph paper to identify how they...

Do you NANDA? NOC and NIC Linkages. Write a 1-2 paragraph paper to identify how they are used in a care plan.

Please write a paragraph on your thoughts on the present value and the NPV capital budgeting...

Please write a paragraph on your thoughts on the present value and the NPV capital budgeting rule: Why PV is it so crucial in finance? Why is the NPV rule superior? Be as specific as possible, giving as many examples and interpretations as possible.

DISCUSSION WEEK 2 Please write 1 paragraph for each question (total 3 paragraphs) and each paragraph...

DISCUSSION WEEK 2 Please write 1 paragraph for each question (total 3 paragraphs) and each paragraph shall be no less than 5 sentences and no more than 10 sentences. Points will be deducted for answers with fewer than 4 sentences or extra long posting (0.5 points per each answer). Give only the essential information. Writing long, run-on sentences will be considered as multiple sentences. Answer ALL PARTS of each question to earn full points. Discussion Topic: 1. Why is responsibility...

Q2. Read the paragraph and answer the following (write it down on a paper) "A bottled...

Q2. Read the paragraph and answer the following (write it down on a paper) "A bottled water company want to change how they are selling their product by the traditional method. They want from their customers to have the option to buy from them directly instead of buying their products through Supermarkets or grocery stores". - What are the options the company can take to allow customers to buy directly from them? - How can they create a value to...

Nursing Informatics versus Information Technology, do you know the difference? Write a 1-2 paragraph paper to...

Nursing Informatics versus Information Technology, do you know the difference? Write a 1-2 paragraph paper to compare and contrast them.

Factors That Affect the Performance of Mutual Funds Post by Day 3 a 3- to 6-paragraph...

Factors That Affect the Performance of Mutual Funds Post by Day 3 a 3- to 6-paragraph assessment of the factors that contribute to a mutual fund’s performance. Please make sure to include responses to the following specific questions: What are the three most important factors that contribute to a mutual fund’s performance? How confident are you that either passively managed or actively managed mutual funds are better performers than the other? To what degree would ownership in the mutual fund...

identify two issues that are related to your career or degree: Write a fully developed paragraph...

identify two issues that are related to your career or degree: Write a fully developed paragraph for issue one (5–8 sentences each). Explain at least two clear arguable sides to the issue. Explain how the issue relates to your field or degree or potential field or degree. Write a fully developed paragraph for issue two (5–8 sentences each). Explain at least two clear arguable sides to the issue. Explain how the issue relates to your field or degree or potential...

Subjects