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Sunk costs - Wikipedia, the free encyclopedia
In economics and business decision-making, sunk costs are retrospective (past) costs which have already been incurred and cannot be recovered. Sunk costs are sometimes contrasted with prospective co...
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Sunk cost dilemma - Wikipedia, the free encyclopedia
A sunk cost dilemma is a dilemma of having to choose between continuing a project of uncertain prospects already involving considerable sunk costs, or discontinuing the project. Given this choice be...
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Sunk Costs Can Sink You ... In any business decision process, including an IT related one, sunk costs can sink a business. In short, a sunk cost is an expenditure made in the past that can't be changed now or in the future. Most expenditures are sunk costs unless, for example, you purchase product that is fully refundable...
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One of the most important lessons they teach in business school is to 'ignore sunk costs'. It doesn't matter how much time or money or effort you've invested in something, if that project no longer makes economic sense, you should... ... Certainly, there are a lot of sunk costs. Years of effort, dues paid,
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The inability to quit Silver Falls is related to a well-known idea in economics about sunk costs. As every student of economics knows, one should never take sunk costs into account when making a decision. They are sunk, and there is nothing you can do about them.
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The concept is important because sunk costs are irrelevant to financial decisions. Many people tend to feel instinctively that because an investment has been made it is necessary to get a return on it. This can lead to people rejecting one course of action in favour of another that actually generates smaller cash flows.
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