Calculate the npv for each educational option

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There are two educational choices the student is considering, with investment and cash flows as follows:

Choice A: Full-Time Education: Example cash investment: $100,000. Currently the student is earning $30,000. Upon graduation the student hopes to earn $60,000 per year in new job. Student will quit the current job.

Choice B: Part-Time Education: Currently the student is earning $30,000. The student can work part-time for three years at a salary of $20,000 while studying towards the master's degree in project management. Upon graduation the student anticipates a possible increase in salary by $10,000 (total $40000) in the same company. Calculate the NPV for each educational option and decide which option the student should invest in. The discount rate is 8%. Explain why Choice A or Choice B was recommended; make assumptions as needed.

Reference no: EM133205952

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