Chapter 1A, Problem 4CTQ

To determine

The question requires us to

• Check the rationality of people who end their formal education after school, after a college degree, and after graduation degree.
• Determine the non-monetary reason people stay in school for different durations.
• Determine the reason for different non-monetary costs and benefits of college among individuals.

Explanation of Solution

In economics, two factors are responsible for almost every decision taken by an individual; scarcity and choices. People have different choices based on the scarcity of resources. Some people join jobs just after school because for them the opportunity cost of attending college is lower. Similarly, people who finish their college degree or graduation might have a lower opportunity cost of getting a job just after school. So, the decision of having different lengths of education is a personal choice based on the scarcity and opportunity cost of getting an education.

Non-monetary reasons such as a passion for learning or getting knowledge, getting a degree, maintaining family reputations, and achieving higher aims can be the reasons for staying in school for different durations.

The opportunity cost can be different for different individuals. Along with the opportunity cost, the non-monetary reasons given above are responsible for the difference in non-monetary costs and benefits among the individuals.