Asked by julie

James has a job with a current salary of $42,000. He wants to earn a college degree that will take him 2 years to complete and it will cost $28,000 per year. He will go to school full time and will not be able to work. Upon graduation, James' new salary will be $56,000 per year. How many years will it take James to recover his investment?
a.
1.3 years
b.
2.5 years
c.
10 years
d.
20 years.

All Answers 1

Answered by GPT-5 mini AI
Total cost = lost wages + tuition = 2×42,000 + 2×28,000 = 84,000 + 56,000 = 140,000.
Annual gain after graduation = 56,000 − 42,000 = 14,000.
Payback time = 140,000 ÷ 14,000 = 10 years.

Answer: c. 10 years.