Authors libby rittenberg 732

earn the $25,000 per year he could make by working full time
during the next four years. After his four years of college, he
expects that his income, both while working and in retirement,
will be $20,000 per year more, over the next 50 years, than it
would have been had he not attended college. Should he go to
college? Assume that each payment for college and dollar of
income earned occur at the end of the years in which they occur.
Ignore possible income taxes in making your calculations. Decide
whether you should attend college, assuming each of the
following interest rates:
1. 2%
2. 4%
3. 6%
4. 8%
4. A new health club has just opened up in your town. Struggling to
bring in money now, the club is offering 10-year memberships for
a one-time payment now of $800. You cannot be sure that you
will still be in town for the next 10 years, but you expect that you
will be. You anticipate that your benefit of belonging to the club
will be $10 per month (think of this as an annual benefit of $120).
Decide whether you should join at each of the following interest
rates:
1. 2%
2. 4%
3. 6%
4. 8%
Attributed to Libby Rittenberg and Timothy Tregarthen
Saylor URL: />
Saylor.org

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