Investment Valuation of a Graduate Diploma for Teachers Implications to Career Advancement in the Academe and Education Management

This is a case study on the Return on Investment (ROI) of a graduate diploma for the faculty members of the College of Education, Arts and Sciences of Lyceum of the Philippines University Batangas. The ROI model for economic valuation was based on the study done by Reyes (Reyes, 2013). This model constructed the revenue function based on per hour rate increase, semestral loading, and other incentives that come with a graduate degree. That study showed that for a Masters degree, ROI after 10 years of employment is 0.66. For a Phd it is 4.42. The present study looked into the opportunity cost of an investment in a graduate degree by obtaining the ROI of alternative investments that can be had for the same capital devoted to finish a graduate degree. These alternative investments were BPI time deposit, Meralco stocks, investment in gold, and investment in a 3 × 1 square meter cemetery plot. The performance of these alternative investments for the last 10 years was analyzed. The revenue functions were constructed using a simple linear regression model. The revenue function and the initial investment which was set equal to the total matriculation fees to finish a graduate diploma yielded the ROI for each of the alternative investments. The results are: BPI time deposit 1.31, gold 1.08, Meralco Stocks 1.16, and cemetery plot 0.33. This makes a Masters degree a less attractive investment in comparison with time deposit, Meralco stocks, and gold. But to earn a Phd is worth its time and money. A faculty can recover his investment in 2.5 years, and he stands to earn an ROI of 4.42 in a 10- year period.

Keywords – ROI, Graduate Diploma, Investment, Economic Valuation, Mathematical Modelling