Sunk cost, opportunity cost, and the endowment effect. You may expect these textbook-weight words to show up in the classroom. You may even imagine how understanding these concepts could help better explain corporate, institutional, or public policy matters—or at least your investment portfolio. But it’s harder to imagine utilizing them to make better decisions in everyday life.
Yet that is where activating an understanding of these and other theoretical models can have the biggest impact: in our lives.
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