diff --git a/docs/training/corpus/Layer_0--Primitive_Facts/CORPUS-0004-cost-includes-more-than-purchase-price.md b/docs/training/corpus/Layer_0--Primitive_Facts/CORPUS-0004-cost-includes-more-than-purchase-price.md new file mode 100644 index 0000000..f343cff --- /dev/null +++ b/docs/training/corpus/Layer_0--Primitive_Facts/CORPUS-0004-cost-includes-more-than-purchase-price.md @@ -0,0 +1,122 @@ +# CORPUS-0004 +## Cost Includes More Than Purchase Price +### Status: Training Corpus Seed +### Layer: Layer_0--Primitive_Facts +### Purpose: Teach that the cost of a venture includes every expense required to acquire, hold, move, protect, and sell the good +### Repository Path: docs/training/corpus/Layer_0--Primitive_Facts/CORPUS-0004-cost-includes-more-than-purchase-price.md + +--- + +## 0. Principle + +Purchase price is not total cost. + +A trader who buys a good must also consider the cost of making that good available for sale in another place or time. + +Total cost may include: + +- purchase price +- porterage +- cart hire +- animal feed +- storage +- dues +- losses from damage +- delay +- spoilage +- guards or escorts +- payments to clerks, witnesses, or handlers + +A low purchase price may still produce a bad venture if the remaining costs are high. + +--- + +## 1. Roman-Visible Example + +A trader buys oil in Ostia for 10 asses. + +He plans to sell it in Capua. + +The purchase price is only the first cost. + +He may also pay: + +- 1 as to move the amphora from seller to storage +- 2 asses for storage before departure +- 4 asses toward cart space +- 1 as for handling at arrival +- 1 as lost through leakage or breakage risk + +The oil did not cost him 10 asses. + +It cost him 19 asses before he could sell it. + +--- + +## 2. Minimal Cost Structure + +A venture cost requires at least: + +1. acquisition cost +2. movement cost +3. holding cost +4. transaction cost +5. loss or damage risk +6. time cost +7. opportunity cost + +A trader must count all costs that exist because the venture exists. + +--- + +## 3. Incorrect Modern Assumption + +Incorrect assumption: + +> If a trader buys for 10 asses and sells for 14 asses, he earns 4 asses. + +Correction: + +> He earns 4 asses only if there are no other costs. If movement, storage, dues, or damage cost more than 4 asses, the venture loses money. + +--- + +## 4. Simulation Use + +This principle supports: + +- venture accounting +- transport cost +- storage cost +- spoilage and breakage +- taxes and dues +- delay penalties +- comparison between possible ventures +- failed trades that looked profitable at purchase + +The model should not calculate profit from purchase price alone. + +--- + +## 5. Canonical Test + +If the model sees: + +> Buy oil for 10 asses. Sell oil for 14 asses. + +It must ask: + +- what did it cost to move the oil? +- what did storage cost? +- were dues paid? +- was any quantity lost? +- how long was capital tied up? +- what other venture was missed? + +Only then can total cost be known. + +--- + +## 6. Success Condition + +If the model stops treating purchase price as total cost and starts counting every burden created by the venture, this file is functioning correctly.