THE "TRUE COST" OF GOING TO SCHOOL
your opportunity cost of going to school
this year is $??,???.
Room, board and recreation do not represent a cost of going to school because you do not have any alternative. i.e. You must eat and sleep regardless of what you do.
Do room, board, and recreation really represent a cost of going to school? No they really are not. What are the alternatives? You are going to want a place to sleep whether you go to school or not. You are going to eat whether you go to school or not. And, you are going to recreate whether you go to school or not. So, they are not really a cost of going to school. Now, if you could live somewhere cheaper than a dorm room, and eat cheaper than on the meal plan, then the cost difference would be a cost of going to school. Let us take a look at the monthly cost of room and board at N.C. State for the dorm room and meal plan specified in our example.
The room is $2,400 for a 9 month lease. That is $266.67 per month and includes basic utilities (water, heat, cooling, electricity). Now you could probably live at home with mom and dad cheaper than that, but eventually folks, most moms and dads are going to show you the door. The meal plan is $2,150 for 9 months. That is $238.89 per month, or $7.96 per day (using 30 days per month). Now admittedly, the amount of eating folks do is highly variable. But for a fellar like me, $7.96 per day is a deal. All you can eat. Cooked for you, dishes washed for you. You just come and eat and eat and eat. I can spend $7.96 for one meal at a fast food restaurant and still be hungry!