A sunk cost is a cost that has already been incurred and cannot be recovered. It is irrelevant to economic decisions as it cannot be changed, so it should not be taken into account when making decisions.

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A Sunk Cost _____

Question 38

Multiple Choice

A sunk cost _____

A) can only be measured in monetary terms.
B) is a cost that has already been incurred and cannot be recovered.
C) should influence a person's choice if that person is a marginal decision maker.
D) lowers the efficiency of production.
E) should not be considered when making economic decisions.

Correct Answer: