Definition Heuristics are mental short cuts. They are ways that we can speed up the decision-making process. Rather than consider all the data, which is time consuming and difficult, someone takes some of the data and makes assumptions in regards … Continue reading
Introduction Marginal value is marginal benefit minus marginal cost. It is simply how much benefit you get per each additional unit of measure (marginal benefit) minus how much it costs you per each additional unit of measure (marginal cost). Example … Continue reading
Introduction There are 2 main ways (on the investor end) that people make money with stocks and I decided to list them out for you below. Those ways are via appreciation/depreciation or by dividends. Appreciation/Depreciation Whether it’s directly or indirectly (though … Continue reading
What is Present Value/Future Value? With any asset, it will get more or less valuable over time (due to appreciation/depreciation and/or cash flow). Present Value is the value of that asset today. If you put 1000 dollars into an investment … Continue reading
What is Price? Price is how much it costs to purchase a good/service. Importance of Price Holding supply equal, price is a measurement of demand. The higher the demand, the higher the price is bid up. When the price increases, … Continue reading
What is Skepticism? Skepticism is when someone doesn’t take an assertion at face value. Adherents demand a higher standard of proof. They don’t deny facts but demand evidence before they accept something as a fact. What is the Application … Continue reading
Overview Free trade and protectionism are 2 approaches that a country can take in regards to trade. It details the ability for people to buy products and services from other countries and/or sell products and services to other countries. It … Continue reading
My Message to You I write these posts to help everyone and I care deeply about advancing financial education so people can make more informed choices. So I ask everyone to send me any questions they have. I want the … Continue reading
In Short As I mentioned in an earlier post, people should focus on what they are best at, and buy/trade for everything else they need. Specialization increases productive capacity and the total sum of knowledge of a community. Example 1 … Continue reading
In Short Compensating Differentials are a fancy way of saying that people are not willing to do horrible jobs unless they are paid more. Wages vs. Comfort If we take 2 jobs that require equal skill, on average the total … Continue reading