The amount paid to purchase equipment last year is an example of a sunk cost.

Name: The amount paid to purchase equipment last year is an example of a sunk cost.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

A sunk cost is a cost that has already been incurred and cannot be recovered, regardless of any future actions or decisions. The amount paid to purchase equipment last year fits this definition as it cannot be recovered and is therefore a sunk cost.

The Amount Paid to Purchase Equipment Last Year Is an Example