23. You're deciding whether to pursue a Master's degree in Economics. With your Bachelor's degree, you'll earn $105,800 per year, but with a Master's degree, you'd earn $134,000 annually. Your degree depreciates at a rate of 2% per year, and the real interest rate is 2%. You should pursue the Master's degree if the present value of the cost of acquiring it is less than _, which includes the cost of a. $2,645,000; tuition b. $705,000; tuition c. $705,000; tuition and foregone income while completing the degree d. $2,645,000; tuition and foregone income while completing the degree

23. You're deciding whether to pursue a Master's degree in Economics. With your Bachelor's degree, you'll earn $105,800 per year, but with a Master's degree, you'd earn $134,000 annually. Your degree depreciates at a rate of 2% per year, and the real interest rate is 2%. You should pursue the Master's degree if the present value of the cost of acquiring it is less than _, which includes the cost of a. $2,645,000; tuition b. $705,000; tuition c. $705,000; tuition and foregone income while completing the degree d. $2,645,000; tuition and foregone income while completing the degree

Microeconomics A Contemporary Intro

10th Edition

ISBN:9781285635101

Author:MCEACHERN

Publisher:MCEACHERN

Chapter13: Capital, Interest, Entrepreneurship, And Corporate Finance

Section: Chapter Questions

Problem 14PAE

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10. What is the present value of a perpetuity of $100 if the appropriate discount rate is 7%? If interest rates in general were to double and the appropriate discount rate rose to 14%, what would happen to the present value of the perpetuity?
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