Suppose Your Expenses for This Term Are as Follows: Tuition

question 96

Multiple Choice

Suppose your expenses for this term are as follows: tuition: $5,000,room and board: $3,000,books and other educational supplies: $500.Further,during the term,you can only work part-time and earn $4,000 instead of your full-time salary of $10,000.What is the opportunity cost of going to college this term,assuming that your room and board expenses would be the same even if you did not go to college?

• A)$5,500
• B)$8,500
• C)$11,500
• D)$14,500

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Definitions:

Present Value

is a financial concept that calculates the current worth of an amount of money that is to be received in the future, taking into account a specific rate of interest.

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Present Value

The current worth of a future sum of money or stream of cash flows, given a specific rate of return.