Can you help me with this question? Thank you Long-term investment decision, NPV

Question

Can you help me with this question? Thank you

Long-term investment decision, NPV method Jenny Jenks has researched the financial
pros and cons of entering into a 1-year MBA program at her state university. The
tuition and books for the master’s program will have an up-front cost of $50,000. If
she enrolls in an MBA program, Jenny will quit her current job, which pays $50,000
per year after taxes (for simplicity, treat any lost earnings as part of the up-front
cost). On average, a person with an MBA degree earns an extra $20,000 per year (after
taxes) over a business career of 40 years. Jenny believes that her opportunity cost
of capital is 6%. Given her estimates, find the net present value (NPV) of entering
this MBA program. Are the benefits of further education worth the associated costs?

Explanation / Answer

Now the cash flows would be as follows

Year 0 = -50000

Year 1 =-50000

Year 2 to 41 = 200000

We can calulate the npv at 6% which owuld come to 176153.38

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