discount rate 0.15 Present value of 'opportunity cost Cumulative PVPV vear -60.000 ? -60,000? -60,000 ? -60,000 2 #VALUE! #VALUE! #VALUE! #VALUE! 3 4 #VALUE! Future value of opportunity cost in year 4 present value periods future value #VALUE! #VALUE! Annuity needed present value in year 4) expected work years additional income per year If the rate of return on human capital is 15 percent and the opportunity cost of time for a newly graduated physician is $60,000 per year, how large an incremental increase in annual earnings should the physician expect to obtain from a four-year post-graduate residency