In his article assessing various viewpoints on commonsense, James Heskett evaluates the dangers of common sense to business managers with regard to how common sense impedes change. In essence, common sense applies in circumstances whereby the decision needs to be made rapidly, with the consequence being the moderate risk and such decisions are conducted by people with accumulated wisdom and knowledge (Duncan 122). Various definitions of commonsense have also been explored, where most are based defined by knowledge and wisdom.
Despite the descending views on how common sense fails us, defenders of common sense argue that personal choices are based on experience, and common sense should not be the sole approach used by managers in decision making.
Discussion on drop in gas prices
The drop in gas prices has a huge implication on the economy. Whereas it’s a win for consumers with price drop at gas pumps, energy companies lose on their stock prices. Importantly, lower oil prices result to an economic boost, since customers have additional income to spend since they pay less at the gas pumps (Villar and Frederick 42). Consequently, the economy thrives on the spending power of consumers is increased. However, from an investment perspective, lower fuel prices imply the decline in ventures and business acquisition in the gas industry. In addition, companies operating in the energy sector record low stock prices and are more adamant to invest further capital into the business.
Consequently, capital investment faces a huge scaling back considering that the business accrues less profit hence is only able to invest in fewer projects. On the other hand, affiliate industries that rely on the oil industry to thrive, experience less investment, considering the prevailing circumstances in the oil sector. For instance, the housing sector will be adversely affected since lesser homes will be built since only limited capital will be available for investment into the sector (Villar and Frederick 42). On the other hand, investors will tend to focus on smaller and privately owned businesses, which have predictability in terms of business growth.
Duncan J. Watts, Everything is Obvious, Once You Know the Answer: How Common Sense Fails Us .New York: Crown Business, 2011. Print.
Villar, Jose A., and Frederick L. Joutz. "The relationship between crude oil and natural gas prices." Energy Information Administration, Office of Oil and Gas (2006): …