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EGR403 Group Presentation

EGR403 Group Presentation. Public Vs. Private Schooling. Group 8. Christopher Bolton Techie Natalie Chaidez Summarizer Bradley Lambrecht Summarizer Michael Wuethrich Organizer. Scenarios: Personal Investment.

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EGR403 Group Presentation

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  1. EGR403 Group Presentation Public Vs. Private Schooling

  2. Group 8 Christopher Bolton Techie Natalie Chaidez Summarizer Bradley Lambrecht Summarizer Michael Wuethrich Organizer

  3. Scenarios: Personal Investment A high school graduate wants to get an engineering degree and is deciding where to go to college. Will a public university such as Cal Poly Pomona or a private university such as CalTech be more beneficial in the long run (at retirement)?

  4. Scenarios Cal Poly Pomona • Travels to school 3 times a week • Works full time 4 days a week • Graduates in 5 years with no loans CalTech • Travels to school 4 times a week • Works part time 2 days a week • Graduates in 5 years with excessive loans

  5. Statistics • Cal Poly Pomona: • Average cost for school per year (tuition, books, parking, etc.) : $6,696.84 • Automotive Expenses: $10,360.83 • Average entry level salary: $67,500/year • Loan at graduation: $0 • CalTech: • Average cost for school per year (tuition, books, parking, etc.): $33,509 • Automotive Expenses: $9,732.22 • Average entry level salary: $83,500/year • Loan at graduation (considering interest) : $244,693.05

  6. Sensitivity Analysis – Cal Poly • Cal Poly Pomona: • Starting Salary vs. Savings Gradient • Years Worked With Company vs. Savings Gradient • Years Until Retirement vs. Savings Gradient

  7. Sensitivity Analysis – CalTech • CalTech: • Starting Salary vs. Savings Gradient • Years Worked With Company vs. Savings Gradient • Years Until Retirement vs. Savings Gradient

  8. Sensitivity Analysis Conclusion • The CalTech graduate wins in the area of savings gradient/quality of living due to having a higher starting salary at the same annual percent raise, which offsets the loan. • The last sensitivity analysis will be used to determine the conditions that the Cal Poly graduate would have to meet in order to achieve a similar savings gradient/quality of living as the CalTech graduate.

  9. And the winner is… CalTech • Regardless of high loans, the higher starting salary will pay off in the long run.

  10. Sensitivity Analysis Comparison • The Cal Poly graduate would achieve a similar gradient if: • He/she worked an extra 5 years or more. • He/she invested a much higher percent in riskier rate of returns in his portfolio. • Ex: 50% in emerging market with 14% ROR. • He/she somehow negotiated a higher starting salary.

  11. Resources • www.csupomona.edu • www.caltech.edu

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