A decrease in the sales of a current project because of the launching of a new project is called:
A)cannibalization.
B)a sunk cost.
C)an overhead expense.
D)an irrelevant aspect of the investment decision.

Question

Quizplus · Accepted Answer

Cannibalization refers to a decrease in the sales of a current project due to the launch of a new project. This is an important consideration in investment decision-making as it can impact the profitability of both the current and new projects. It is important to assess the extent of cannibalization and factor it into forecasting and decision-making.

A Decrease in the Sales of a Current Project Because