Suppose you paid $400 tuition for a three-credit course.After the official withdrawal date has elapsed, you decide to drop the course but you cannot get back your $400.At this time, the $400 is
A) the benefit of earning three credits.
B) an expenditure made on the margin.
C) a sunk cost.
D) the opportunity cost of the course.
E) the marginal cost of the course.

Question

Quizplus · Accepted Answer

The $400 is a sunk cost because it cannot be recovered once the official withdrawal date has passed. It does not affect any future decision-making and therefore does not factor into the decision to drop the course.

Suppose You Paid $400 Tuition for a Three-Credit Course