11 Cardinal Sins of Economics from last lecture by my professor @ a top 10 b-school
I currently go to a top 10 business school and these were the "11 Cardinal Sins of Economics" to wrap up the last lecture of my managerial econ course. Thought I would share this.
Feel free to expound and discuss your opinions.
1) Our company must be worth more than that we paid for it.
2) Costs are measured best by accountants.
3) We must cover out costs; otherwise we should stop producing right now.
4) Do everything we can to produce best possible product.
5) Selling our product is profitable; thus we should produce more.
6) To save money, we should use low-cost instead of high-cost labor.
7) Our price should be based on our total costs.
8) We should raise price because industry demand is inelastic.
9) We should maximize our profit margin.
10) Our competitive advantage guarantees long-run profits.
11) There is a market for this product; we will make money by producing it.
surprised your top 10 business school professor didn't mention lose money on every sale, but make up for in in volume.
Unless you go to Chicago or MIT, your Top 10 B School doesn't matter. Only two Econ departments worth the respect.
absolutely ridiculous
Sounds almost like something Luke Froeb at Vandy would say, but with less of a focus on ignoring sunk costs and finding hidden costs
Cardinal sins, as in your professor is saying these are misguided notions?
Or, he is of the opinion that these are 11 rules to live by? (Making this really the 11 commandments)
I read it as a “mindsets to watch out for” type of list. Things people often follow or justify their actions by saying, but are actually circumstantial goals.
Gotta be the former cause #10, for instance, is blatantly wrong as a generalization.
The "top 10 business school" comment was completely unnecessary. Are you expecting that people will value your list more if you make this claim?
Let the quality of your post speak for itself. In this case, the post is evidently written by someone with a poor grasp of English so it's unlikely to be copy produced by a teacher at a "top 10 business school" (unless you meant a top 10 school in some country where English is not the native language).
But apart from the quality of the copy, there's a lot of garbage in there, and statements of the obvious ( #6 being a good example).
@DalaiLama makes a good point above. Did your professor actually mean "cardinal sins" or did s/he mean "commandments"?
I suggest you investigate moving to a better business school.
There was obviously a lot of grey area filled between the slides in the form of graphs and equations.
Its pretty easy to throw rocks at general statements.
Thanks for the suggestion!
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