A B 1 2 3 4 5 5 7 B 9 0 1 CURRENT SALARY 2 MBA STARTING SALARY 3 MBA TUITION 4 F G H You are 30 years old and are considering getting an MBA. Your annual salary is $50,000, expected to grow by 3% per year (without an MBA) MBAs typically earn $80,000 per year, with salaries growing by 4% per year. You are considering going to an MBA program fulltime, which is a 2 year program. The program costs $30,000 per year,payable at the end of each study year. You want to retire at 65, which is 35 years from today. The relevant discount rate is 8%. Is it worthwhile for you to quit your job for two years in order to pursue an MBA? 50,000 GROWTH RATE: 80,000 GROWTH RATE: 30,000 DISCOUNT RATE: 3.00% 4.00% 8.00% 569890-234567890-23456789 5 AGE (AT BIRTHDAY) YEAR NORMAL SALARY PV OF NORMAL SALARY MBA TUITION MBA SALARY PV OF MBA TUITION AND SALARY 30 31 32 33 34 1 35 36 37 38 123456789 39 10 40 11 41 12 42 13 43 14 44 15 45 16 46 17 47 18 48 19 49 20 50 21 51 22 52 23 53 24 0 54 25 -1 55 26 2 56 27 3 57 28 4 58 29 -6 -7 -1 56789012 59 30 60 31 61 32 62 33 64 34 65 35 TOTAL VALUE WITHOUT MBA WITH MBA -2