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Scoby Jones wants to become an accountant. He invests $55,000 to attend a 5th year of college and switch from being a finance major to
Scoby Jones wants to become an accountant. He invests $55,000 to attend a 5th year of college and switch from being a finance major to an accounting major. Once he begins working, he will be able to earn $10,000 more per year in his first 2 years and then $20,000 more per year for the next 3 years than he would have with a finance degree. After that, he will be so fed up with the job he will quit. His current WACC is 11%. What is the NPV of this investment?
The answer is $1,792.71, but I would like to know the steps in how to get it.
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