Question

aaron is a high school graduate working as a retail clerk. he earns a median salary for a high school graduate. aaron is thinking about going to college to get an associates degree. if he completes his degree in 2 years and college costs total $30,000, how long will it take aaron to recover his investment, assuming that he earns the median salary and continues to work full time while he is attending school? median annual household income by educational attainment of householder, 1997

Explanation:

Step1: Find the salary difference

The median - salary of a high - school graduate is $33,779, and the median - salary of an associate's degree holder is $45,258. The difference in annual salary $\Delta S=45258 - 33779=\$11479$.

Step2: Calculate the pay - back time

The total cost of college is $C = 30000$. Let $t$ be the number of years to recover the investment. We use the formula $t=\frac{C}{\Delta S}$. Substituting the values, we get $t=\frac{30000}{11479}\approx2.61$. Rounding up to the next whole year, it will take 3 years.

Answer:

3 years