The loss in sales of an existing product is a sink cost when assessing the cost of a new product if:

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A sunk cost is a cost that has already been incurred and cannot be recovered. In this case, the loss in sales of an existing product cannot be recovered and should be considered a sunk cost. However, if the loss in sales is due to a competitor's product, it is not a cost that can be attributed to the development of a new product and should not be included in the analysis.

The Loss in Sales of an Existing Product Is a Sink