Turbo Shoes

Having an old car is almost as expensive as having a child. I’ve never had a child, but I’m going to assume they are expensive. Every small noise my car would make was a sign of trouble. For one month, I had to get my car fixed twice. Almost $2,000 later, it still didn’t work. Was I ripped off? Maybe. Did I own a piece of junk? Definitely. Finally, I decided to buy a new car; well, at least the car would be new to me.
First, I needed to figure out how much I could pay monthly. I looked at my expenses to see where I could cut down on spending. Of course my savings for college, rent, and utilities couldn't be cut down. As much as it hurt, I realized I had to stop buying shoes. See, that would be no problem if I didn’t work with shoes. I need to believe in what I sell. It was also very unrealistic for me to just stop buying the things I love most. With this in mind, I had to compromise with myself. Per month, I would have a $600 budget, a car payment would be about $300 and a pair of shoes would be about $60. My budget constraint graph is shown below. 
For my opportunity cost, I would need to give up buying 5 pairs of shoes for one car payment. Or buy 5 pairs of shoes and miss a car payment, which is very irresponsible. I do only need one car payment per month, but I would like to pay off the loan faster. 
 Looking at the bigger picture, let’s say I buy 2 pairs of shoes monthly. That would be $120. In a year, that would be $1,440. That money could be used for something more useful. Like for tuition for college, or a vacation, or savings for an emergency. This would also be my opportunity cost. If I only do one car payment monthly, then I have an extra $300. In a year that would be $3,600. But I would be stuck paying for my car loan longer. 
 It is also quite obvious to see that purchasing a car is a better option than using an Uber or Lyft. This would be an example of positive analysis. 
An example of normative analysis would be to donate $300 to charity, just like the book pointed out. 
After much deliberation, I decided to purchase only one pair of shoes monthly so I could buy a BMW and have some money left for any necessities. 


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