A cost that has been incurred, or will be incurred, whether a project is accepted or rejected, is known as:
A) An incremental cash flow.
B) An externality.
C) A sunk cost.
D) A terminal cash flow.

Question

Quizplus · Accepted Answer

Sunk costs are costs that have already been incurred or are unavoidable in the future, regardless of the decision made about a project. They should not influence the decision-making process since they cannot be recovered or changed.

A Cost That Has Been Incurred, or Will Be Incurred