A company spends $20 million researching whether it is possible to create a durable plastic from the process waste from feedstock preparation.How should the $20 million best be considered?

Question

Quizplus · Accepted Answer

The $20 million spent on research is considered a sunk cost because it has already been incurred and cannot be recovered. It is not relevant to future decisions about the project.

A Company Spends $20 Million Researching Whether It Is Possible