Tuesday, September 15, 2009

Six things I've learned

I'm paying tens of thousands of dollars for an education but am so generous I will share one free fact I've picked up from each of my classes.

1. Problem Framing: A load-bearing assumption is one whose failure would require a company to make significant changes. For example, a newspaper makes several load-bearing assumptions, such as that people can read.

2. Economics: The supply curve in the short run for a particular factory looks like a stair that goes up, right, up. That's because up to the price at which it should produce anything, it will produce nothing; once it reaches that price, it will produce at full capacity; and once it hits that capacity, it can't produce anymore, no matter how much the price goes up.

3. Accounting: The difference between a gain and a revenue is that a gain doesn't come from core operations. So if a baker sells a cake, he earns revenue, and if he sells one of his trucks, he makes a gain.

4. Probability/Statistics: For any normally distributed random variable, 68% of values fall within one standard deviation of the mean.

5. Spreadsheet Modeling: Calculating the expected value of perfect information is relevant not because information is ever perfect but because that value is an upper bound for what one should be willing to spend on any information.

6. Careers: On a resume and in job interviews, one should have a compelling story about one's career that contains the elements of any good story: a protagonist, a catalyst compelling the protagonist to take action, trials and tribulations, a turning point and a resolution.

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