Question

After earning your ba, you have to decide whether to accept the offer of a job that will pay you $45,000 per year or spend an additional two years earning an mba. if you decide to pursue the graduate degree, your annual expenses for tuition, books, board, and lodging will be $32,000. you have been offered a scholarship for $10,000 per year, but in order to pay the remaining $22,000 per year, you would have to cash in savings bonds that your grandparents have given you that have been earning $500 in interest per year. the annual opportunity cost of earning your mba is:

Answer 1

$67,500

cost of the wages that you could be earning + loans + lost interest

45000 + 22000 + 500 = 67,500