Which bus to take

April 5th, 2007 Lima, Peru

A Lesson In Opportunity Cost and Sunk Cost

We arrived in Lima in the morning and headed to the next terminal that would take us south to the department of Ica where we would be spending Easter weekend vacation. When we arrived at the terminal, we found the line to buy tickets wrapped around 2 blocks. We waited an hour and a half to buy to tickets and found out there was still an hour wait to get on a bus. We made a quick phone call to some friends who just arrived in Lima and had them check out the other terminal that goes to Ica. They called back and told us they just bought tickets (no line) and could board the bus in the next half hour.

But we were only ten minutes from getting our tickets. There were six of us. Two environmental volunteers and three business volunteers. We started hashing it out and the three business volunteers decided the costs incurred so far were sunk. We headed to the other terminal. When we arrived we learned this terminal was also charging $5 less. The environmental volunteers stayed with the other line. They paid $5 more to arrive at the hotel an hour after us. They also never took Economics 101.