Escalation of commitment is likely to occur when the perceived costs of terminating the project are high or unknown.

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Some experts argue that throwing more money into a failing project is sometimes a logical attempt to further understand an ambiguous situation.This strategy is essentially a variation of testing unknown waters.By adding more resources, the decision maker gains new information about the effectiveness of these funds, which provides more feedback about the project's future success.This strategy is particularly common where the project has high closing costs.

Escalation of Commitment Is Likely to Occur When the Perceived