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Discount rate = 10% 1. Assume the following income stream resulting for human capital investment. Age Y 18 1000 19 1000 20 1000 21 1000

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1. Assume the following income stream resulting for human capital investment. Age Y 18 1000 19 1000 20 1000 21 1000 22 1000 23 1000 24 1000 25 1000 A. Calculate the present value for a 17,20, 22,24, and 25 year old. B. Suppose this person drops out of the labor force for ages 20, 21,22, and 23. Compute the present value at ages: (1) 17 (2) 18 (3) 19 (4) 20 (5) 21 (6) 22 (7) 23 (8) 24 (9) 25 C. What implications does dropping out of the labor force have on investment in human capital? 1. Assume the following income stream resulting for human capital investment. Age Y 18 1000 19 1000 20 1000 21 1000 22 1000 23 1000 24 1000 25 1000 A. Calculate the present value for a 17,20, 22,24, and 25 year old. B. Suppose this person drops out of the labor force for ages 20, 21,22, and 23. Compute the present value at ages: (1) 17 (2) 18 (3) 19 (4) 20 (5) 21 (6) 22 (7) 23 (8) 24 (9) 25 C. What implications does dropping out of the labor force have on investment in human capital

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