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Group 3

Group 3. Eric Aube Joseph Tirona. How long do I have to stay in school? . Bachelor’s vs. Master’s in Engineering vs. MBA By Eric Aube and Joseph Tirona. Scenario.

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Group 3

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  1. Group 3 Eric Aube Joseph Tirona

  2. How long do I have to stay in school? Bachelor’s vs. Master’s in Engineering vs. MBA By Eric Aube and Joseph Tirona

  3. Scenario • A Mechanical Engineering student at Cal Poly is about to graduate with his Bachelor’s Degree. He has a 3.6 GPA and gets offered a job at Jet Propulsion Laboratory for $60,0000. He is debating between: taking the job offer, staying in school to get a Master’s Degree in Mechanical Engineering, and getting a Master’s in Business Administration (MBA).

  4. Scenario 1: Bachelor’s Degree • Age at Graduation: 23 • Starting Salary: $60,000 (salary.com) • Retiring at: 62 • Annual salary increase: 3% • Percent of pre-tax income in 401K: 15% • Company matches 80% up to 10%

  5. Scenario 2: Master’s Degree in Mechanical Engineering (CPP) • Full time Graduate Student • Age at Graduation: 26 • Starting Salary: $70,000 (salary.com) • Extra tuition cost: $20,000 over three years • Retiring at: 62 • Annual salary increase: 3% • Percent of pre-tax income in 401K: 15% • Company matches 80% up to 10%

  6. Scenario 3: Master’s Degree in Business Administration (CPP) • Full time Graduate Student • Age at Graduation: 25 • Starting Salary: $65,000 • Extra Tuition Cost: $12,000 over two years • Retiring at: 62 • Annual salary increase: 3% • Percent of pre-tax income in 401K: 15% • Company matches 80% up to 10%

  7. Criteria • Which of the three options will yield the best future value at age 62? • Holding all other factors constant • Cost of transportation • Cost of living • Personal expenditures (food, vacations, etc.)

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