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Assume there are two periods: t = 1 is today, and t = 2 is tomorrow. An individual can choose to go to college today and work tomorrow, or he can choose not to go to college and work in both periods. If the individual does not attend college, he earns $100 in each period. If he goes to college today, he only earns $200 tomorrow. Assuming the discount rate is 0.5, what choice will the individual make, and why?

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Assume there are two periods: t = 1 is today, and t = 2 is tomorrow. An individual can choose to go to college today and work tomorrow, or he can choose not to go to college and work in both periods. If the individual does not attend college, he earns $100 in each period. If he goes to college today, he only earns $200 tomorrow. Assuming the discount rate is 0.5, what choice will the individual make, and why?





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