Joe Is Considering His Options

Joe is considering his options. This summer he will graduate with a B.S. degree in actuarial science and he can begin working this year. His other option is to apply to a medical school to pursue the physician assistant degree. The degree will cost $80,000 in tuition, will take 2 years to complete, and will result in an increase in his annual earnings by about $10,000 per year. Dividing the gain by the cost results in

A) a positive return, so Joe should apply to medical school.
B) a negative return, so Joe should stick with actuarial science career.
C) a negative return, but does not account for the opportunity cost of Joe's additional time in school and the uncertainty, time and effort involved in completing the application process and school.
D) a positive approximate return, but to get a more precise estimate Joe should also consider adding the following costs to the cost side of the equation: the opportunity cost of additional time in school and the uncertainty, time and effort involved in completing the application process and degree requirements.
E) a positive approximate return, but to get a more precise estimate Joe should also consider adding the opportunity cost of Joe's additional time in school and the uncertainty, time and effort involved in completing the application process and degree requirements to the cost side of the equation, while adding the value of the satisfaction Joe expects to receive from choosing a medical career (over the actuarial career) to the gain side of the equation.