Sarah places a $110 value on seeing the Richmond Tigers play in the Grand Final.She purchases a ticket to the game for $60 but when she arrives at the game she discovers that her ticket is missing.A ticket scalper outside the stadium is selling tickets for $76 dollars.If Sarah purchases a ticket from one of the scalpers for $95, she is best demonstrating the principle that:

Question

Quizplus · Accepted Answer

Sunk costs, like the $60 already spent on the lost ticket, are irrelevant to the decision of whether to buy a new ticket. Sarah's decision to buy a new ticket despite the loss demonstrates this principle, as she focuses on the current cost and her valuation of the experience rather than the lost money.

Sarah Places a $110 Value on Seeing the Richmond Tigers