Sunk costs
A) should be taken into consideration when making decisions about future production.
B) are costs that have been incurred as a result of past decisions.
C) cause the profit-maximizing rule to no longer be useful.
D) are future costs that one has to incur.
E) are included only in economic profits.

Question

Quizplus · Accepted Answer

Sunk costs are costs that have already been incurred due to past decisions and cannot be recovered. Therefore, they should not be taken into consideration when making decisions about future production.

Sunk Costs