The potential benefit that is given up when one alternative is selected over another is called a sunk cost.

Question

Quizplus · Accepted Answer

The definition given in this statement is incorrect. The potential benefit given up when one alternative is selected over another is actually called an opportunity cost. A sunk cost refers to a cost that has already been incurred and cannot be recovered, regardless of the decision made.

The Potential Benefit That Is Given Up When One Alternative