Education can view as consumption and investment. A product or services is considered to belong to the consumption category when it gives satisfaction or utility in a single period only while, it is considered pure investment goods or services when it is expected to give satisfaction in the future periods only.
Education is regarded as the most important determinant of a person’s economic and social success. In economy, terms of education is an economic good because anything that satisfies a human wants is considered a good. Consumption can be determined as simply paying the cost for a good or services and receiving all of the benefits for that good or services immediately. Education as consumption is education as a fundamental human right one of the right of every citizen in each country. It defined as consumption goods because a lot of the students could be said to be enjoyed the lectures and the homework given including the reading. This can be seen where many countries set the basic education that is primary and secondary school were used as compulsory education. Education is also seen as public goods. It considered as consumption as it motivated by a desires to satisfy the need for personal development, social needs, and also for the needs of knowledge for understanding. Higher education can be viewed both as a consumption good for which the individual is willing to pay, and as an investment alternative that yields higher wages later in life.
Besides that, education is as an investment aiming to obtain greater net income or rate of return in the future. In other words, investment in education occurs when current consumption is sacrifice towards the purchase of education that is expected to give a higher level of benefits in the future. For instance, higher education level usually will provide higher future income and at the same time providing higher levels of future consumption. Education is an investment to increases the individual’s... [continues]
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