In Determining Whether a Further Investment in Education for a Individual

question 49

Multiple Choice

In determining whether a further investment in education for a individual is worth the costs, an economist would look at whether the sum of the

• A)annual education costs is exceeded by the sum of annual income to the person.
• B)annual education costs is exceeded by the sum of the increases in income that are attributable to the increased education.
• C)present value of the annual education costs is exceeded by the sum of the present value of the annual income to the person.
• D)present value of the annual education costs is exceeded by the sum of the present value of the increases in income that are attributable to the increased education.

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Definitions:

Average Variable Cost

The total variable cost per unit of output, found by dividing total variable costs by the quantity of output produced.

Fixed Cost

Costs that do not vary with the level of production or sales, such as rent, salaries, or insurance premiums.

Eyeglasses

Corrective or protective lenses mounted in a frame to aid vision or protect the eyes.

Average Variable Cost

The cost per unit of variable inputs divided by the total quantity of output produced.