Math 123 Quantitative Reasoning ProjectSummer2017

Financial Project

Due:

As an Ivy Tech student, you are making an investment in your education. This project will look at how that investment will pay off if you graduate and get a job in your desired field.

Assume that the median annual income for a high school graduate is$20,000.This is the value that you will be comparing your expected salary and lifestyle to in the following areas:

1)Income Comparison:Research your expected income after you graduate college. Assume you obtain whatever level of education needed to enter your desired area of employment andthat you willhave a salary equivalent to the annualMediansalary found at:http://www.bls.gov/oes/current/oes_in.htm#27-0000*You will need to click on your desired career in order to see theAnnual Medianwage.

Your reflection paper should explain what your desired area of employment is and what the median annual salary for that position is.

Your reflection paper should contain at least one statement comparing your expected salary with that of the median income of a high school graduate.

2)Housing Comparison:Assume that you and your high school graduate counterpart planto spend 20% of your gross income on house payments.Look up the currentfixed rateAPR for mortgages and use Excel todetermine the largest value of a house thateach of you can afford under those conditions.

Your reflection paper should contain at least one statement comparing the value of the house that a high school graduate can afford and that you expect to be able to afford.

Explain in your reflection paper what Excel function was usedfor these calculations.Cite what source you used to find mortgage rates.

Research housing costs in an area where you would like to live.Will your future salary allow you to afford the house you want, or should you consider other housing options?How much more or less must you spend to get the house you want?Cite what source you used to find housing costs.

3)Raises:The high school graduate's income is not expected to increase over the nextfiveyears, but assume that your field will guarantee you a3% raise on your annual salary each year for the nextfiveyears. Determine what your new annual salary will begiven thesefiveyearsof raises.Using this new income, recalculate the mortgage from part 2.

Your reflection paper should contain at least one statement comparingyourinitial salary with the salary after 5 years of raises.

Your paper should explain how you determined the increased salary.

Your paper should address how your increased salarymight impact your mortgage value.