The sunk costs error occurs when decision makers forget that current choices cannot correct the past.

Question

Quizplus · Accepted Answer

The sunk costs error refers to the tendency of decision makers to continue investing resources in a project or course of action based on the time, money, or effort already invested, even if the future benefits are low or non-existent. This error occurs when decision makers fail to realize that sunk costs are irretrievable and should not influence current choices or future decisions. Therefore, the correct answer is A, as the sunk costs error is indeed associated with the mistaken belief that past investments can be recouped or justified.

The Sunk Costs Error Occurs When Decision Makers Forget That