Economic Analysis: College Investment and Financial Returns

This assignment analyzes the financial implications of college as an investment, examining the earning potential of bachelor's degree holders compared to high school graduates. It delves into the costs associated with higher education and the potential return on investment, considering factors such as tuition fees and the delayed entry into the workforce. The analysis references studies and arguments from sources like Owen and Sawhill, and Liz Addison. The assignment discusses the perspectives of students and parents when choosing a college, highlighting the importance of factors like institutional success rates, faculty quality, and career opportunities. The paper presents conflicting viewpoints regarding the value of a four-year college degree, discussing the advantages and disadvantages of pursuing higher education based on individual financial situations and career goals. The document also discusses the trajectory of educational attainment and its impact on lifetime earnings.

Running Head: QUESTION-ANSWER
QUESTION-ANSWER
Name of the Student:
Name of University:
Author Note:

1QUESTION-ANSWER
Answer 1
The major factor for making the college a questionable investment is the rate of
profitability that a student can incur in compare to a high school pass-out employee. The
statistics and calculations represent that a year of college increases the earning $3,000 and after
the end of four years it becomes $12,000. However, the raw difference between the earning of
high school graduates and bachelor degree holders is $15,000 (Owen and Sawhill 2013).
Therefore, the cumulative earning amount of the bachelor degree students is still less. Moreover,
the cost of college matters is also played a crucial role in the process of making college a
questionable investment. For instance, it is not possible for all the people to enter into workforce
in late because everyone do not have the opportunity to delay four years more to earn.
Answer 2
Figure 1 of the discussion tries to present a trajectory of educational attainment. It means
the data projects a difference in the earning of bachelor degree holders and high school diploma
people. It is true that the initial profit gap between the college goer and high school attendee is
$15,000. However, the gap is extending over life time and it is promising for the college goers to
earn high profitability throughout the career. There are two contradictory facts that can be seen in
the graph. Firstly, there is a project shows that 23 to 25 years old bachelor degrees make $12,000
more than the school graduates but by the age of 50. However, the overall estimation provides
the statistics that a total sum of $570,000 can be earned by the bachelor’s degree students with
the cost of investment of $ 102,000 for four years of college. Therefore, the return is definitely
high and effective.

2QUESTION-ANSWER
Answer 3
The argument of Liz Addison was very straight forward as she tried to establish her own
perception and understanding regarding the efficacy of bachelor degree programs in the
universities. As per her argument, the college degrees should have been completed within two
years rather than extending to a prolonged four years course. She argued that the education
system of United States was transforming rapidly where people were aware of the quality of
studies and the long term benefits that can be generated through the higher studies. Therefore,
students prefer to opt for the college courses which are of two years and then get a job on the
basis of their merits and qualifications. On the other hand, the university degrees merely meet the
preliminary interest of the students where people are pursuing for university degrees just to
enhance the weightage of their curriculum vitae.
Answer 4
The success rate of the institution and the expenses of the bachelor program are
considered to be the most important information that the parents and students are looking for
before choosing the right college. One of the major reason is the high cost in higher education
(Owen and Sawhill 2013). Therefore, both the students and the parents are wish to invest in the
best college where the career opportunity and exposure is very high. However, the students did
not know about the faculty and their way of teaching. Information on the best faculties and best
departments can be an effective practice for choosing the right university or college.

3QUESTION-ANSWER
Answer 5
It can be stated that not all the college degrees are considered as smart investments
because it depends on the need and financial stability of the students to pursue for higher studies.
Obvious there are some advantages for the students who are started doing jobs after the end of
the high schools. It provides them the financial stability that they want and the satisfaction.
However, the article suggests that qualified students are able to earn more than the high school
qualified students (Owen and Sawhill 2013). Therefore, it is also a problem for the students to
get disadvantages in pursuing long term benefits.

4QUESTION-ANSWER
Reference
Owen, S. and Sawhill, I., 2013. Should everyone go to college?. Brookings Institution, Center on
Children and Families.