Please enter the calculations correctly for each question providing step$-$by$-$step analysis. Do not use complex formula and break it down if needed:

THE MBA DECISION $-$ Please provide step$-$by$-$step calculation and make sure it's correct.

Ben Bates graduated from college six years ago with a finance undergraduate degree. Although

he is satisfied with his current job, his goal is to become an investment banker. He feels that

an MBA degree would allow him to achieve this goal. After examining schools, he has nar$-$

rowed his choice to either Wilton University or Mount Perry College. Although internships

are encouraged by both schools, to get class credit for the internship, no salary can be paid.

Other than internships, neither school will allow its students to work while enrolled in its MBA

program.

Ben currently works at the money management firm of Dewey and Louis. His annual

salary at the firm is $$69,000$ per year, and his salary is expected to increase at $3$ percent per

year until retirement. He is currently $28$ years old and expects to work for $40$ more years. His

current job includes a fully paid health insurance plan, and his current average tax rate is

$26$ percent. Ben has a savings account with enough money to cover the entire cost of his MBA

program.

The Ritter College of Business at Wilton University is one of the top MBA programs in

the country. The MBA degree requires two years of full$-$time enrollment at the university. The

annual tuition is $$75,000,$ payable at the beginning of each school year. Books and other sup$-$

plies are estimated to cost $$3,600$ per year. Ben expects that after graduation from Wilton, he

will receive a job offer for about $$115,000$ per year, with a $$20,000$ signing bonus. The salary

at this job will increase at $4$ percent per year. Because of the higher salary, his average income

tax rate will increase to $31$ percent.

The Bradley School of Business at Mount Perry College began its MBA program $16$ years

ago. The Bradley School is smaller and less well known than the Ritter College. Bradley offers

an accelerated, one$-$year program, with a tuition cost of $$90,000$ to be paid upon matriculation.

Books and other supplies for the program are expected to cost $$5,400.$ Ben thinks that he will

receive an offer of $$96,000$ per year upon graduation, with an $$18,000$ signing bonus. The

salary at this job will increase at $3\mathrm{.}5$ percent per year. His average tax rate at this level of

income will be $29$ percent.

Both schools offer a health insurance plan that will cost $$3,500$ per year, payable at the

beginning of the year. Ben also estimates that room and board expenses will cost $$2,500$ more

per year at both schools than his current expenses, payable at the beginning of each year. The

appropriate discount rate is $4\mathrm{.}7$ percent.

$1.$ How does Ben$$s age affect his decision to get an MBA?

$2.$ What other, perhaps nonquantifiable, factors affect Ben$$s decision to get an MBA?

$3.$ Assuming all salaries are paid at the end of each year, what is the best option for Ben$$

from a strictly financial standpoint?

$4.$ Ben believes that the appropriate analysis is to calculate the future value of each option.

How would you evaluate this statement?

$5.$ What initial salary would Ben need to receive to make him indifferent between attending

Wilton University and staying in his current position?

$6.$ Suppose, instead of being able to pay cash for his MBA, Ben must borrow the money.

The current borrowing rate is $4\mathrm{.}3$ percent. How would this affect his decision?