Question

Consider Larry's decision to go to college. If he goes to college, he will spend a total of $120,000 on tuition, $30,000 on room and board, and $3,500 on books over four years. If he does not go to college, he will earn $30,000 annually working in a store and spend $7,000 on room and board each year. Larry's cost of going to college isa. $123,500.b. $153,500.c. $190,500d. $245,500

Answer 1

Answer:

d. $245,500

Explanation:

The cost of Larry's decision to go to college is the sum of all the costs related to attending college plus the benefits he will lose by not choosing the alternative that is working in a store for four years.

$120,000+$30,000+ $3,500+(($30,000-$7,000)*4)

$153,500+(23,000*4)

$153,500+$92,000= $245,500

Larry's cost of going to college is $245,500.