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Opportunity Cost

Opportunity Cost

Saying 'yes' to something automatically means saying 'no' to other possibilities. This is known as Opportunity Cost. It translates into the potential benefits that we miss by choosing one option over another.

Subconsciously we are aware that we can't do everything we want at the same time. However, when we are more aware of this concept, we can make better decisions.

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Prioritize Your Options

If you want to become more aware of opportunity costs in your career, prioritize the important work.

Make a list of your top 5 priorities, keep it in a visible place, and live according to those priorities.

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Risks of Ignoring The Opportunity Cost

It's easy to overlook the cost of hypothetical opportunities. But if neglected, opportunity costs will negatively impact your life, career, and relationships.

  • Working on autopilot means you put in the hours and get paid, but you end up with nothing: no important know...

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Eliminate Options

Our first ideas are not always the best. At any given time, we have multiple options when it comes to spending our time.

We can't do everything. We have to make choices. When we get clear on our priorities, we will be able to eliminate many options and in the process, make...

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rykerx

For every question, there is an answer. For every problem, there is a solution. For everything else, there is an explanation.

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Opportunity Cost: You Can Do Anything but Not Everything

When mulling over multiple choices, the quality of any option cannot be assessed in isolation from its alternatives. The price you pay (or the sacrifice you make, or the benefits you give up) for doing what you’ve chosen to do instead of doing something else is the opportunity cost.

Opportunity Cost in Non-financial Situations

Opportunity Cost in Non-financial Situations

Opportunity cost in non-financial situations is more difficult to quantify. The loss or gain with choosing an option while foregoing another can be subjective and not readily comparable.

Example: While deciding on which job offer to take, we may consider job satisfaction, brand name, com...

Learn to Evaluate Life Choices Via the Lens of Opportunity Costs

  • You live in a world where you must therefore make choices. You cannot avoid regret since there are opportunity costs for every choice you will make.
  • Everything in life is about opportunity costs. Every time you say “yes” to a choice, you are also saying “no” to everything else you ...

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