Suppose that Nancy lives for three periods and chooses to be a Dentist. This means that she will spend $30,000 on education in the first period, earn $150,000 in the second period, and earn $180,000 in the third period. (Assume that all costs and wages are paid at the BEGININNING of each period). If Nancy can lend and borrow money at a 10 percent annual (per period) rate, what is the net present value of becoming a Dentist (rounded to the nearest dollar)? O $244,124 O $277,124 O $255,124 O $266,124

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Comparative Advantage and Absolute Advantage Analysis

The theory of absolute advantage was given by Adam Smith in the year 1776.