In considering the trade-in of a vehicle, which of the following is a sunk cost?

Question

Quizplus · Accepted Answer

A sunk cost is a cost that has already been incurred and cannot be recovered. The original purchase price of the old vehicle is a sunk cost because it has already been paid and cannot be recovered. Depreciation on the new vehicle, trade-in value of old vehicle, and purchase price of new vehicle are not sunk costs as they are all current or prospective expenses that can be influenced by current decisions.

In Considering the Trade-In of a Vehicle, Which of the Following