1. You are the CFO of a private college. You know that each student attends school for exactly 4 years. Education is expensive. It costs the school 20k per year per student to run the school, but tuition is only 19k. Effectively, you are losing 1k per student per year. You also know that alumni often give back to the school after graduation. Specifically, on average, students make a 10k donation to the school on their 20th anniversary of graduation. From strictly an NPV point of view, what is the total cash flow, total costs, discounted cash flows, NPV and IRR the school gets on EACH student. The schools discount rate is 6%. Is the school doing ok?

2. The school can either encourage graduates to give more. Specifically, they have

4. Which is the better plan? Ask to give more?