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Economic Trade-off of Graduate School Jessica Sotomajor, of Bangor, Maine, works for a military contractor and hopes to earn an extra $580,000 over her remaining
Economic Trade-off of Graduate School Jessica Sotomajor, of Bangor, Maine, works for a military contractor and hopes to earn an extra $580,000 over her remaining 20-year working career by going back to school to obtain a doctoral degree. If her income projection is correct, that's an average of over $29,000 more income a year. Jessica's employer is willing to pay half, or $45,000, toward the $90,000 cost of the annual Ph.D. program, so she must pay $45,000 of her own money, Jessica wonders if the expected extra income would warrant spending the money to get the Ph.D. Round your answers to the nearest whole dollar. a. What is the forgone lost future value of her $45,000 over the 20 years at 7 percent? Round Future Value of a Single Amount in intermediate calculations to four decimal places. (Hint: See Appendix A-1.) $ b. What would be the forgone lost future value of $90,000 over 20 years if Jessica had to pay all the costs for her doctoral degree? Round Future Value of a Single Amount in intermediate calculations to four decimal places. (Hint: See Appendix A-1.) $ c. Advise Jessica as to what she should do. Jessica -Select- take the opportunity to obtain the Ph.D. degree as it is a financially sound decision.
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