To "think like an economist," decisions should include:

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To "think like an economist," decisions should include opportunity costs, which are the value of the next best alternative forgone as a result of choosing one option over the other. Total fixed costs (A) and accounting costs (B) are important to consider in business decision-making but are not specific to thinking like an economist. Explicit costs (C) are a type of accounting cost and may be relevant in some cases, but again, the essential concept for thinking like an economist is opportunity cost.

To "Think Like an Economist," Decisions Should Include