Mary is an 18-year-old high school graduate who can take a job paying $30,000 without further education. The prevailing interest rate is 10 percent.
-Now assume that after completing a one-year post-secondary program, Mary would earn $60,000 than if she had stopped her education right after high school. Should Mary complete the post-secondary program and what is the internal rate of return?
A) Yes, since the return is 100 percent
B) No, since there is no return
C) Yes, since the return is 50 percent
D) Yes, since the return is 10 percent
E) No, since the return is less than 10 percent
Correct Answer:
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