Ben Bates
1. Brief summary of the case
Ben Bates, 28 years old, graduated from college six years ago with a finance undergraduate degree. He is now working at the financial management company of Dewey and Louis. He expects to work for 38 years later. His goal is to become an investment banker. And he feels that an MBA degree would allow him to achieve this goal.
After examining schools, he has narrowed his choice to either Wilton University or Mount Perry College.
- The Ritter College of Business is under Wilton University: It offers the country’s leading MBA program. Its MBA degree requires two years of full-time enrollment at the university. The annual tuition is $63,000, payable at the beginning of each school year. Books and other supplies are estimated to cost $2,500 per year.
- The Bradley School of Business at Mount Perry College began its MBA program 6 years ago. The Bradley School is smaller and less well known than the Ritter College. Its program lasts one year, with a tuition cost of $80,000 to be paid upon matriculation. Books and other supplies for the program are estimated to cost $3,500.
Both schools offer a health insurance plan that will cost $3000 per year, payable at the beginning of the year. Ben also estimates that room and board expenses will cost $20,000 per year at both schools. Besides, neither school will allow its students to work while enrolled in its MBA program.
Here is Ben’s private financial information: His annual salary is $50,000 per year, and it is expected to increase at 3 percent per year until retirement. His current job includes a fully paid health insurance plan, and his current average tax rate is 26 percent. Ben has a savings account with enough money to cover the entire cost of his MBA program.
Ben expects that after graduation from Wilton, he will receive a job offer for about $98,000 per year, with a $15,000 signing bonus. The salary for this job will be increased by 4 percent per year. His average income tax rate will
Ben Bates, 28 years old, graduated from college six years ago with a finance undergraduate degree. He is now working at the financial management company of Dewey and Louis. He expects to work for 38 years later. His goal is to become an investment banker. And he feels that an MBA degree would allow him to achieve this goal.
After examining schools, he has narrowed his choice to either Wilton University or Mount Perry College.
- The Ritter College of Business is under Wilton University: It offers the country’s leading MBA program. Its MBA degree requires two years of full-time enrollment at the university. The annual tuition is $63,000, payable at the beginning of each school year. Books and other supplies are estimated to cost $2,500 per year.
- The Bradley School of Business at Mount Perry College began its MBA program 6 years ago. The Bradley School is smaller and less well known than the Ritter College. Its program lasts one year, with a tuition cost of $80,000 to be paid upon matriculation. Books and other supplies for the program are estimated to cost $3,500.
Both schools offer a health insurance plan that will cost $3000 per year, payable at the beginning of the year. Ben also estimates that room and board expenses will cost $20,000 per year at both schools. Besides, neither school will allow its students to work while enrolled in its MBA program.
Here is Ben’s private financial information: His annual salary is $50,000 per year, and it is expected to increase at 3 percent per year until retirement. His current job includes a fully paid health insurance plan, and his current average tax rate is 26 percent. Ben has a savings account with enough money to cover the entire cost of his MBA program.
Ben expects that after graduation from Wilton, he will receive a job offer for about $98,000 per year, with a $15,000 signing bonus. The salary for this job will be increased by 4 percent per year. His average income tax rate will