The local school district wants to close down a neighborhood high school because its outdated heating and cooling systems make it too expensive to operate compared to the new high school being built nearby. Parents who are against closing the neighborhood school argue that the $2 million spent refurbishing the school over the past few years will be wasted if the school is shut down. This argument is an example of
A) a sunk cost fallacy.
B) a framing bias.
C) overconfidence.
D) altruism.

Question

Quizplus · Accepted Answer

The argument is an example of a sunk cost fallacy because it focuses on the money already spent (which cannot be recovered) as a reason to keep the school open, rather than considering the future costs and benefits of the decision.

The Local School District Wants to Close Down a Neighborhood