Question
Suppose Fred Flintsone just graduated high school and he is going to live 2 more periods. He can take a job at a rock quarry
Suppose Fred Flintsone just graduated high school and he is going to live 2 more periods. He can take a job at a rock quarry which will pay $20,000 in each period. Or he could go to business school in the first period at a cost of $4,000 dollars. At the end of the first period, he can get a job as a "human resource manager" making $40,000. Using a discount rate of 10% and assuming Fred wants to maximize the present value of his life time earnings, should Fred take the job at the quarry or should he invest in education to become a human resource manager? Explain and show your calculations
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