Joe pre-orders a non-refundable movie ticket. He then reads a number of reviews of the movie in question that make him realize that he will not enjoy it. He goes to see it anyway, rationalizing that otherwise his money will have been wasted. Is Joe succumbing to the Sunk Cost Fallacy, and why?
A) Yes, since he invested a valuable asset, his time, in a project based on its previous costs.
B) No, because the cost of the movie was not recoverable and would have been lost whatever action he took.
C) No, because going to see the movie means that the product of his initial investment was realized as originally planned.
D) Yes, because he incurred no further costs by going to see the movie.

Question

Quizplus · Accepted Answer

Joe is succumbing to the Sunk Cost Fallacy because he is allowing his past investment (the non-refundable ticket) to influence his decision to see the movie, even though he believes he will not enjoy it. By going to see the movie anyway, he is investing even more time (a valuable asset) into a project that he believes is not worth it, solely because he feels that otherwise, his money (the cost of the ticket) will have been wasted.

Joe Pre-Orders a Non-Refundable Movie Ticket