Questions to help you see through the lens of opportunity cost:
1. And then what?
2. Compared to what?
3. At the expense of what?
1. And then what?
2. Compared to what?
3. At the expense of what?
Direct costs are mostly obvious, visible, and easy to measure. Most people only focus on these.
Indirect costs are mostly invisible and uncertain. Seeing them requires judgment and foresight.
If you only think about direct costs, you'll only see what everyone else sees.
Indirect costs are mostly invisible and uncertain. Seeing them requires judgment and foresight.
If you only think about direct costs, you'll only see what everyone else sees.
Footnote: Credit to Warren Buffett, Charlie Munger, and Peter Kaufman for helping me see this.
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