Suppose you have two friends who have the same underlying ability, took the same courses in college, and have the same GPA. One of them decides to go to a business school for an MBA, while the other one chooses to pursue a PhD in English literature. Given that the expected earnings of an MBA are much higher than the expected earnings of an English PhD, is one of your friends being irrational?

Question

01-02-2021
Business

contestada

Suppose you have two friends who have the same underlying ability, took the same courses in college, and have the same GPA. One of them decides to go to a business school for an MBA, while the other one chooses to pursue a PhD in English literature. Given that the expected earnings of an MBA are much higher than the expected earnings of an English PhD, is one of your friends being irrational?

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Answer:

Rational is based on the logical preference. Being irrational does not means that the choice is made based on monetary preference. It is more logical than monetary.

Explanation:

The two friends took same courses in college but after the completion of college degree one decides to go for MBA and other pursues PhD in English. The expected earnings of MBA are higher than PhD but one of friend who chooses the PhD has not considered the logical decision making based on money. He might have chose the PhD because he is more interested in becoming a professor rather than a business professional.