When you’re shopping for toothpaste, you might check the price tag before heading to the counter to make the
purchase. If you happen to find a 12oz tube of Colgate for $4 and a 12oz tube of Crest for $3, odds are you are going
to go with the Crest – its human nature to pay less if your “expected return” will be the same. In the case of
toothpaste, you’re getting fluoride from either option, but paying less makes the return on that investment higher.
You care what things cost and price matters, it’s why price-tags are front and center for nearly everything you can
purchase – clothes, cars, food, travel etc. This theory can and should be applied when making investment decisions as
well, no matter what “environment” we’re in.
For more, download the pdf:
