Question

Niah works as a retail sales clerk earning $18,000 per year. She plans to go to school for medical billing that has a median salary of $35,000. The cost of her education will be $20,000. If Niah does not work for the 2 years that she is in school, about how long will it take her to recover her investment if she gets a medical billing job making the median salary when she graduates? a. Less than 1 year b. 1. 2 years c. 1. 6 years d. 3. 3 years.

Answer 1

The correct statement will be that the time taken by Niah to recover her total invested over such investment on the course will be 1.6 years. So, the correct option is C.

The time taken for such recovery of the investment can be calculated in summation of the opportunity costs and course fees, being divided by the total median annual salary.

Opportunity costs

• The opportunity cost refers to the cost which is born by the cost by putting the time and efforts over another things and not getting the expected returns over such period.

• The investment along with the opportunity cost can be derived by using the values as,

• $\rm Total\ Investment= \ 36000+\ 20000\\\\\\\rm Total\ investment= \ 56000$

• Now it has been known to us that Niah has not worked in the past two years and will be getting the median salary after she completes the course. So calculating by using the below formula,

• $\rm Time\ Taken\ For\ Recovery= \dfrac {Total\ Investment}{Total\ Median\ Annual\ Salary}\\\\\\\rm Time\ Taken\ For\ Recovery= \dfrac {\ 56000}{\ 35000}\\\\\\\rm Time\ Taken\ For\ Recovery= 1.6\ Years$

So we can conclude that Niah will be requiring the time frame of 1 year and 6 months to recover her total investments, along with the opportunity costs being born for two years.

Hence, the correct option is C, that Niah will require 1.6 years to recover her total investments made over the medical billing course.

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Answer 2

Answer:

D

Explanation:

3.3 years