In early July,Jim Lopez purchased a $70 ticket to the December 15 game of the Chicago Titans.(The Titans belong to the Midwest Football League and play their games outdoors on the shore of Lake Michigan. )Parking for the game was expected to cost approximately $22,and Lopez would probably spend another $15 for a souvenir program and food.It is now December 14.The Titans were having a miserable season and the temperature was expected to peak at 5 degrees on game day.Jim is thinking about skipping the game and taking his wife to the movies and dinner,at a cost of $50.The amount of sunk cost that should influence Jim's decision to spend some time with his wife is:

Question

Quizplus · Accepted Answer

Sunk cost is a cost that has already been incurred and cannot be recovered. In this case, the sunk cost is the $70 ticket that Jim has already purchased. The other costs (parking, souvenir program, food, and the cost of taking his wife to the movies and dinner) are not sunk costs because they have not yet been incurred. Therefore, the amount of sunk cost that should influence Jim's decision is $70.

In Early July,Jim Lopez Purchased a $70 Ticket to the December