While shopping for a concert ticket to see One Direction, Ayumi's favorite band, she mistakenly purchases a non-refundable ticket for the Off-Off Broadway play One Dissection. Ayumi has no interest in seeing this play, but because the ticket cost her $100 she is unsure what to do. In the end, Ayumi's best decision if she is thinking rationally would be to:

Question

Quizplus · Accepted Answer

This decision is based on the concept of sunk cost fallacy. The $100 spent on the play ticket is a sunk cost and cannot be recovered. Ayumi's decision should be based on her current options and preferences, which is to see One Direction. Going to the concert maximizes her utility despite the initial loss.

While Shopping for a Concert Ticket to See One Direction