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Business, 07.08.2021 01:30 icantspeakengles

Suppose that an individual is 20 years old and is contemplating on attending the university for a 4 year degree. The cost of attending the university (implicit and explicit) is $20,000 per year for 4 years starting right now. The additional benefit of the college education (implicit and explicit) is $5,000 per year, which he will receive from age 25 until age 65. a. If the interest rate is 5 percent, use the NPV analysis to determine if he should or should not go to college. Show your calculations.
b. If the interest rate is 8 percent, use the NPV analysis to determine if he should or should not go to college. Show your calculations.

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