Opportunity Cost

There is a concept that gets thrown around in economics classes called opportunity cost.  In that context, opportunity cost is simply the fact of life that if you invest in one thing, you are necessarily no longer able to use those resources to invest in another.  If you put ten thousand dollars into buying a car, that’s ten thousand dollars that you can’t use for the down payment on a house.  If you invest 30% of your salary each month in your retirement accounts, that’s 30% that you can’t use now to go on vacation.  A fairly simple concept, really, and it rarely is discussed outside of economics classrooms.

Sententia Discussion Series 5: Statistics

We've talked a bit about statistics before. Sometimes, it seems that our modern society has a numbers fetish. Every argument seems to come down exclusively to data, decisions are made based on data, and the world turns on enormous quantities of data (I really should do a post on "Big Data" and its implications). All of that data is presented in the form of statistics, but statistics can be made to say almost anything.