1997 Subaru Outback: Repair or Scrap

My 1997 Subaru Outback Wagon has about 172k miles on it and now I am told that either the head gasket or head needs repairing. I have been quoted between 2500-3500 dollars for the repair. Is it worth it or do I try to find a reliable less used car for twice that? Will my car hold up to return my investment?

FYI - just graduated from grad school, unemployed (for the moment)…

If you want to keep the car, the body is in excellent shape, and other things are fine on it you may want to consider getting a rebuilt engine instead repairing yours. With a rebuilt engine you will have a warranty. Check out CCR Engines. The labor cost will add a little more to the bill and it would be wise to replace the radiator also if you did that but you will have a trouble free engine and a 3 year warranty to go with it.