Question

The lesson of __________ is to forget about the money that's irretrievably gone and instead to focus on the marginal costs and benefits of future options. sunk costs marginal utility marginal analysis budget constraints

Answer 1

The lesson of sunk costs is to forget about the money that's irretrievably gone and instead to focus on the marginal costs and benefits of future options. A sunk cost is a cost that happened during the manufacturing of something else and there is no way to recover that money back if the item or service fails. These costs will happen no matter the decision or outcome of a situation so most companies do not factor in sunk costs.