Question for the pro's about transaction costs...

[Sponger15SB]

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How is 40$ an hour 80k a year? How many hours per week?

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$40 an hour, 100 hours a week. 20 weeks a year. Duh....

or maybe he just figured that usually people work 40 hours a week and get 2 weeks vacation a year. (hint:40x40x50=80,000)

[zaxx19]

40 bucks an hr...its alot but im sure my ole pops makes more and believe me we arent rich.....really depends on where you live. 100K sounds like alot but when you have to live close to a company situated in one of the nicer suburbs in the country(my dad's case) youd be suprised at how modest a 100k a yr earner lives.(we have a 3 bedroom split level and 3 toyotas....)

[zaxx19]

Actually in the next 30 yrs thatll be GREAT JOB. Outsourcing is coming and unless you have a terribly attractive advanced proffessional degree(see top tier law or any medical-pharmaceutical) these 80-150k white collar jobs are gonna be few and far between especially in the financial services fields. Sorry to all the business and accounting majors out there but my brother has an MBA from Rice makes like 87k for KPMG and has told me in 15 yrs hell probably either move up or get fired bc Indians can do his job for 5-10 k a yr and plans are already being made.

[nightlyraver]

LOL - that's so funny. My Dad works for KPMG (in computer software) and he keep saying the same thing.

[BigBaitsim (milo)]

There are 2080 work-hours in a year. A simple rule of thumb for converting hourly rate to yearly salary is to double the dollars/hour and that's how many thousands you make a year.

Example: You work at McDonalds and earn $5.15/hour. You are making $10,300/year and clearly need a new job.

[MCS]

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If you are the best player in the field, I think you fold and get your money in at a better spot.

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I know this wasn't really the point of the thread, but a good player will take this opportunity to try to triple up. It's really, really unlikely that you're 51% to triple up if you pass here.

There was a thread on 2+2 about how people who aren't top tournament players seem to overestimate the importance of "survival." Basically, it seemed to me that you should get your money in almost every time your chip EV is positive.

The thread was something about folding AA if there were like six players all-in on the first hand of the tournament, and a number of good players weighed in to say that the idea of "survival" is overrated. I know Paul Phillips was involved; I think David Sklansky was too.

[ricdaman]

I make $15 an hour playing 1 table of 2/4 limit online. That works out to $30,000 a year. Where I live, that's $4000 above the average income. For my town, I make an above average income playing poker.

To answer the question, it's all about opportunity cost. If the average income in this town were say $35,000, and I knew I could get a job that paid $35,000 a year, then it would be +EV for me to work at a job instead of play poker.

Or, in the case of the coin flip, if the $90 per coin flip over XXX average hours was more than the gambler could make doing something else, then do it. Otherwise, do something else that makes more money.

[Arm187r]

opportunity cost haven't heard that since economics class

[nightlyraver]

My point however is the fact that you have a larger investment in a hand at a final table, 6 hours or so into a tourney than on the first hand. Personally, if I have AA on hand #1, I am getting my chips in as fast as I can no matter how many players go all-in ahead of me. However, say you have 66 and you KNOW the other guy has AQo and pushes you all-in. This call has both a +EV and +CV, yet it is small. Therefore, you are making perhaps 20% more money over time, but should you not equate the 6 hours that you spent to get to that decision point into the decision? This is not about a cash game where you make the call virtually every time, this is a tourney...

[TDCumm16]

I believe when making the fold/call decision in your example that the opportunity cost of tournament time and other costs such as gas, hotel, etc. should not be considered.

Time spent, gas, hotel, etc. are all sunk costs and cannot be changed by the result of your fold/call decision. When making a rational decision, economic theory tells us that only incremental costs should affect the decision-making process... in this case we should only consider the EV of our fold/call decision. We should not consider the costs that will not change as a result of this decision.