Which of the following should be included in the analysis of a proposed investment?
I.Erosion effects
II.Opportunity costs
III.Sunk costs
IV.Side effects

Question

Quizplus · Accepted Answer

All of the options should be included in the analysis of a proposed investment. Erosion effects refer to the possible decline of revenue or added expenses in other areas due to the investment. Opportunity costs refer to the potential profit or benefits that are forfeited as a result of choosing one investment over another. Sunk costs refer to expenses that have already been incurred and cannot be recovered. Side effects refer to the potential positive or negative impact of the investment on other aspects of the business or society.

Which of the Following Should Be Included in the Analysis