Originally by: Kat Bandeis

---

Edited by: Kat Bandeis on 07/05/2009 07:09:19
Edited by: Kat Bandeis on 07/05/2009 07:04:58
And then comes the "opportunity cost" crowd. :) Real profit versus crying over what might have been. I sell a widget that cost my accounting ledger nothing to produce; I make 100 isk. My bank balance rises 100 isk. OR I sell the same widget for 100 isk, when I COULD HAVE SOLD IT for 110 isk. I JUST LOST 10 ISK!!

No. My bank balance went up 100 isk, not up 90 isk, or down to -10 isk. Opportunity cost is a fescicious argument used here muddy the waters when it comes to a basic principle: cost ain't the same thing as value. If I mine ore and sell if for 1 million, when I could have sold it for 1,100,000 isk, I'm not LOSING anything, I'm in fact MAKING 1 million. If some of you insist on whining that other people aren't doing business the way you think they should, that's your problem. Keep thinking you have fixed costs when you don't.

And so nobody uses the same tired bad analogy in argument, let me just say that any friggin' moron who builds something and sells it for less than the market will bear (irrespective of value or cost) is just stupid. Which has nothing to do with the original post.

Edit: Oh, and PS: I don't use 11 million in minerals to build something and sell it for 10.5 million. Your example is intentionally deceptive, not to mention inane. Let me post another person's previous example:

Me: I mine 10 mil worth of minerals (zero cost), build something, sell for 15 million, my bank balance rises 15 mil.
You: Buy 10 million worth of minerals (10 mil cost), build something, and sell for 15 million. Your bank balance falls 10 mil, then rises 15 mil. Net profit = 5 mil. Who wins?

---