Benefits of further education worth the associated costs

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Jenny Jenks has researched the financial pros and cons of entering into a 1-year MBA program at her state university. The tuition and needed books for a master's program will have an upfront cost of $102,000. On average, a person with an MBA degree earns an extra $22,000 per year (after taxes) over a business career of 38 years. Jenny feels that her opportunity cost of capital is 5.6%.

Given her estimates, find the net present value (NPV) of entering this MBA program.

Are the benefits of further education worth the associated costs?

Reference no: EM131575623

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