Question

Ashwin plans to study further. He wants to do some analysis before deciding. The cost of attending a private college for one year is ₹75,000 for tuition, ₹ 5,000 for the room, ₹4,000 for meals and ₹3,000 for books and supplies. Ashwin also had the alternative of earning ₹60,000 p.a., by taking up a job instead of going to college. Further Joe could have earned 10% interest on the expenses he plans to incur at the beginning of the year if he plans to join the college and study further. If Ashwin finishes the studies which is a one-year course he would be capable of earning ₹20,000 per month. Help Joe deciding by calculating the following:
a) Explicit costs
b) Implicit costs
c) Total Economic costs of attending college.
d) What would be your decision in this situation? Substantiate.​

Answer 1

(C Total economic costs of attending college.