Reference no: EM131301959
NPV of Your University Degree
I would like you to utilize the concepts to determine the Net Present Value of your degree of university. Additionally, you may want to further motivate yourself by calculating the degree of effort you are putting into this degree (ie hours expended each year), and calculating an hourly wage you are receiving for this effort.
Things your submission should consider:
• Cost of Tuition ($8,255 per year).
• Opportunity cost of being here.
• Number of hours per year you work at University in obtaining your degree. (3 hours * 4 classes * 12 weeks * 2 terms = 288 hours per year)
• Number of years you will spend at University? (5 years)
• 6% interest rate.
• Assume you will start work immediately after graduation in either case, whether you graduate or not.
• What your starting salary will be with your degree versus without a degree.
• Career = 35 years after you graduate
• Starting Salary will grow by 5% per year when you graduate.
• Salary will grow by 3 % per year if you did not start or finish your degree.
• You will receive a pension equal to 70% of what you made on the last (35th) year of your career, forever with no growth.
• After 25 years of retirement, you die, and your pension dies with you.
Show your all details and process and fomulas.
|
Considering setting up a firm to produce widgets
: You are considering setting up a firm to produce widgets. The cost of the project is $30 today. The demand for widgets is uncertain. It can be either high or low with equal probability. When the demand is high cash flows in t = 1 are $66 and when the..
|
|
What determines the shape of yield curves
: What is a yield curve and how is it drawn? What determines the shape of yield curves? Briefly discuss how the segmented markets theory, the expectations theory, and the liquidity premium theory explain the shape of the yield curve. What should be the..
|
|
About the retirement account and saving account
: Sam’s parents just retired and have $450,000 in a retirement account. They can earn 4% in this account. If they want to withdraw equal amounts of money every year for the next 30 years (starting at the end of this year), how much can take out every y..
|
|
Higher profits in world with normal or inverted yield curve
: It is a fact that the federal government (1) encouraged the development of the savings and loan industry, (2) virtually forced the industry to make long-term fixed-interest-rate mortgages, and (3) forced the savings and loans to obtain most of their ..
|
|
Determine the net present value of your degree of university
: I would like you to utilize the concepts to determine the Net Present Value of your degree of university. Additionally, you may want to further motivate yourself by calculating the degree of effort you are putting into this degree (ie hours expended ..
|
|
How data was used to calculate wacc
: Write a two or three page report that contains the following elements: Your calculated WACC. How data was used to calculate WACC. This would be the formula and the formula with your values substituted.
|
|
What is the percentage cost of trade credit to customers
: McDowell Industries sells on terms of 3/10, net 30. Total sales for the year are $912,500; 40% of the customers pay on the 10th day and take discounts, while the other 60% pay, on average, 40 days after their purchases. What is the days sales outstan..
|
|
Assume taxes are automatically deducted from each paycheck
: Vincent Lecavlier, a Montreal native, played for the Tampa Bay Lightning. He had a ten year contract worth $100 million ($10 million per year). He dreamed of playing for the Montreal Canadians and 4 years into his contract with Tampa Bay, he was trad..
|
|
Interest payments are quarterly at libor plus
: On April 15, KS Inc. Takes out a one year floating rate loan for $10 million. Interest payments are quarterly at LIBOR plus 200 basis points based on actual days in the period over 360. The payments are due July 15, January 15, and April 15. KS purch..
|