What is the 80/20 rule and how useful is it? The 80-20 rule, also known as the Pareto principle, states that 80% of the results come from 20% of all causes of a given event. It means that 80% of the revenue comes from 20% of the effort. This has many optimization implications. For example, in a company, one of the goals of the 80-20 rule is to identify and prioritize the most productive inputs possible. Once the factors that are critical to the company's success have been identified, the most attention must be paid to these factors. Although the 80-20 rule is often used in business and economics, you can apply this concept to any field, such as wealth distribution, personal finance, consumption habits, and even infidelity in interpersonal relationships. In theory, the 80-20 rule is about determining the best assets of an entity and using them effectively to create the most value. For example, students should try to determine which parts of the textbook will create the gre...