Present value of net benefits

1. (36 points) Read the article "Americans Losing Faith in College Degrees, Poll Finds" which is the next file in this Canvas module. Answer the following questions. a. (6 points) The article reports poll results pertaining to investment in higher education. What proportion of college grads say college is "worth it" what proportion say it is not. How do these poll results compare to all respondents? What proportion of all respondents say college is "worth it" what proportion say it is not. Why has the percentage of Americans who believe that college is worth its cost fallen? b. (6 points) What proportion of women say college is "worth it" what proportion say it is not. How has this changed for women since 2013? How do these poll results compare to men? What proportion of men say college is "worth it" what proportion say it is not. Given the work-life cycle of "traditional" women and a gender pay gap of around 13 percent explain why it is rational for more women to invest in human capital than men. c. (6 points) What is the human capital view of investment in education? Write out the Present Value of Net Benefits formula and use it in answering the following questions. d. (6 points) Graph your Age-Earnings Profile with and without a College Education. The numbers on the graph should be your best estimate of costs and future net benefits for you. e. (6 points) Enter your annual estimate of costs and future net benefits into the Present Value of Net Benefits formula. Based on this formula is a college education "worth it" for you? Extra Credit (up to 5 points): Use an interest rate of .07 (7 percent) and calculate the present value of your investment in education. Based on these calculations is a college education "worth it" for you? f. (6 points) Should all people attend college? If so, why? If not, which people should attend? When selecting college majors, should students take into account discounted lifetime earnings associated with various majors