Suppose college education raises a person's wage by $30,000 per year, from $40,000 to $70,000. Assume that the interest rate is 3 percent and there is no growth in wages. Suppose you are a high school senior and are deciding whether or not to go to college. Find the PDV of earnings in the following cases. Also, assume that the work time is still 45 years, adding up to a 49-year non-college work career.

a) What is the PDV of your labor income if you do not go to college and start working immediately?

b) As and alternative, you could pay $20,000 per year in college tuition, attend college for four years, and then earn $70,000 after you graduate. What is the PDV of your net earnings (adjusting for tuition) umder this plan?

c) Discuss the economic value of college education/

d) What if you pursue the plan described in (b), but you also expect to be unemployed for 2 years after finishing college (knock on wood). during these years assume that you do not have access to any unemployment insurance. What is the PDV of your net earnings under this plan?