Person B has completed his graduation six years ago with an undergraduate degree in finance. His aim was to be an investment banker; however, he is satisfied with his present job. He was searching for the best college to do an MBA program, which he thinks would assist him in achieving his aim. He was looking for University W and College M. The details of his current job and his course details are provided. Characters in the case: Person B University W College M Company DL College R College M School B Adequate information: If person B remains at the current job, then the present value of his after tax salary is $1,044,728.37. The present value of the direct cost if Person B joins University W is $151,377.23. The present value of the after tax bonus that is paid in two years from the salary if he joins University W is $12,212.72. To calculate: The initial salary that Person B has to get to make him different in attending University W and staying in his current position.

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Answer 1

Question

Chapter 4, Problem 5MC

Summary Introduction

Case summary:

Person B has completed his graduation six years ago with an undergraduate degree in finance. His aim was to be an investment banker; however, he is satisfied with his present job. He was searching for the best college to do an MBA program, which he thinks would assist him in achieving his aim. He was looking for University W and College M. The details of his current job and his course details are provided.

Characters in the case:

Person B

University W

College M

Company DL

College R

College M

School B

Adequate information:

If person B remains at the current job, then the present value of his after tax salary is $1,044,728.37.

The present value of the direct cost if Person B joins University W is $151,377.23.

The present value of the after tax bonus that is paid in two years from the salary if he joins University W is $12,212.72.

To calculate: The initial salary that Person B has to get to make him different in attending University W and staying in his current position.

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Answer 2

Question

Chapter 4, Problem 5MC

Summary Introduction

Case summary:

Person B has completed his graduation six years ago with an undergraduate degree in finance. His aim was to be an investment banker; however, he is satisfied with his present job. He was searching for the best college to do an MBA program, which he thinks would assist him in achieving his aim. He was looking for University W and College M. The details of his current job and his course details are provided.

Characters in the case:

Person B

University W

College M

Company DL

College R

College M

School B

Adequate information:

If person B remains at the current job, then the present value of his after tax salary is $1,044,728.37.

The present value of the direct cost if Person B joins University W is $151,377.23.

The present value of the after tax bonus that is paid in two years from the salary if he joins University W is $12,212.72.

To calculate: The initial salary that Person B has to get to make him different in attending University W and staying in his current position.

Expert Solution & Answer

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Answer 3

Question

Chapter 4, Problem 5MC

Summary Introduction

Case summary:

Person B has completed his graduation six years ago with an undergraduate degree in finance. His aim was to be an investment banker; however, he is satisfied with his present job. He was searching for the best college to do an MBA program, which he thinks would assist him in achieving his aim. He was looking for University W and College M. The details of his current job and his course details are provided.

Characters in the case:

Person B

University W

College M

Company DL

College R

College M

School B

Adequate information:

If person B remains at the current job, then the present value of his after tax salary is $1,044,728.37.

The present value of the direct cost if Person B joins University W is $151,377.23.

The present value of the after tax bonus that is paid in two years from the salary if he joins University W is $12,212.72.

To calculate: The initial salary that Person B has to get to make him different in attending University W and staying in his current position.

Expert Solution & Answer

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Answer 4

Question

Chapter 4, Problem 5MC

Summary Introduction

Case summary:

Person B has completed his graduation six years ago with an undergraduate degree in finance. His aim was to be an investment banker; however, he is satisfied with his present job. He was searching for the best college to do an MBA program, which he thinks would assist him in achieving his aim. He was looking for University W and College M. The details of his current job and his course details are provided.

Characters in the case:

Person B

University W

College M

Company DL

College R

College M

School B

Adequate information:

If person B remains at the current job, then the present value of his after tax salary is $1,044,728.37.

The present value of the direct cost if Person B joins University W is $151,377.23.

The present value of the after tax bonus that is paid in two years from the salary if he joins University W is $12,212.72.

To calculate: The initial salary that Person B has to get to make him different in attending University W and staying in his current position.

Expert Solution & Answer

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Answer 5

Chapter 4, Problem 5MC

Summary Introduction

Case summary:

Person B has completed his graduation six years ago with an undergraduate degree in finance. His aim was to be an investment banker; however, he is satisfied with his present job. He was searching for the best college to do an MBA program, which he thinks would assist him in achieving his aim. He was looking for University W and College M. The details of his current job and his course details are provided.

Characters in the case:

Person B

University W

College M

Company DL

College R

College M

School B

Adequate information:

If person B remains at the current job, then the present value of his after tax salary is $1,044,728.37.

The present value of the direct cost if Person B joins University W is $151,377.23.

The present value of the after tax bonus that is paid in two years from the salary if he joins University W is $12,212.72.

To calculate: The initial salary that Person B has to get to make him different in attending University W and staying in his current position.

Answer 6

Chapter 4, Problem 5MC

Summary Introduction

Case summary:

Person B has completed his graduation six years ago with an undergraduate degree in finance. His aim was to be an investment banker; however, he is satisfied with his present job. He was searching for the best college to do an MBA program, which he thinks would assist him in achieving his aim. He was looking for University W and College M. The details of his current job and his course details are provided.

Characters in the case:

Person B

University W

College M

Company DL

College R

College M

School B

Adequate information:

If person B remains at the current job, then the present value of his after tax salary is $1,044,728.37.

The present value of the direct cost if Person B joins University W is $151,377.23.

The present value of the after tax bonus that is paid in two years from the salary if he joins University W is $12,212.72.

To calculate: The initial salary that Person B has to get to make him different in attending University W and staying in his current position.

Answer 7

Chapter 4, Problem 5MC

Summary Introduction

Case summary:

Person B has completed his graduation six years ago with an undergraduate degree in finance. His aim was to be an investment banker; however, he is satisfied with his present job. He was searching for the best college to do an MBA program, which he thinks would assist him in achieving his aim. He was looking for University W and College M. The details of his current job and his course details are provided.

Characters in the case:

Person B

University W

College M

Company DL

College R

College M

School B

Adequate information:

If person B remains at the current job, then the present value of his after tax salary is $1,044,728.37.

The present value of the direct cost if Person B joins University W is $151,377.23.

The present value of the after tax bonus that is paid in two years from the salary if he joins University W is $12,212.72.

To calculate: The initial salary that Person B has to get to make him different in attending University W and staying in his current position.

Answer 8

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Answer 9

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Answer 10

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Answer 11

Ch. 4 - Prob. 1CQ Ch. 4 - Prob. 2CQ Ch. 4 - Prob. 3CQ Ch. 4 - Prob. 4CQ Ch. 4 - Time Value On subsidized Stafford loans, a common...Ch. 4 - Prob. 6CQ Ch. 4 - Prob. 7CQ Ch. 4 - Prob. 8CQ Ch. 4 - Prob. 9CQ Ch. 4 - Prob. 10CQ

Solution Summary: The author explains that Person B is satisfied with his current job and is looking for the best college to do an MBA program.

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Chapter 4 Solutions