If a firm decides,after it has begun a project that the project will not produce value for the firm,how can the firm get the most value out of the project?

Question

Quizplus · Accepted Answer

If the firm has already determined that the project will not produce value, it is best for the firm to sell the assets purchased for salvage value to minimize losses. Continuing the project or changing inputs would only result in additional sunk costs with no guarantee of producing value in the end. Transferring the project to a subsidiary in a low-cost country may not necessarily add value and could potentially result in additional costs or legal issues. Selling the assets for salvage value allows the firm to recoup some of their investment and move on to more profitable endeavors.

If a Firm Decides,after It Has Begun a Project That