Browse MBAs SECTION 4: Managerial Economics

The Opportunity Cost Framer

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The Opportunity Cost Framer

Make the true cost of this choice visible by surfacing what I'd give up.

The choice: [DESCRIBE]
The alternatives I'm not taking: [LIST]
Resources committed: [TIME, MONEY, CAPACITY, ATTENTION]

Provide:
1. The explicit costs (cash out the door)
2. The implicit opportunity costs (the best alternative use of these
   resources)
3. The full economic cost once opportunity cost is included
4. Whether the choice still makes sense on that fuller basis
5. The opportunity cost I'm most likely underweighting

Reframe the decision as "compared to what?" — that's where the real cost
lives.

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