Answer to Question #97884 in Macroeconomics for annie

Question

In recent years, the collage costs in USA moved up. At the same time the wage difference between the high school students and collage graduates went up. How would you expect the expected effect of these trends to be on the number of students in USA who are willing to get collage education?

Answer 1

Despite the increase in the price of education in US colleges, the number of students will not decrease. This is due to the fact that education is an investment in the future of own children, and from this perspective it is important to proceed from the principle of payback. The costs incurred in education at the current time will lead to obtaining much greater incomes and benefits in the future. And vice versa, saving on children's education will result to the loss of future benefits, such as high-paying and popular work. All of the above takes place under the unchanged state of the labor market, the state of the world and state economies.