Which of these items would be best categorized as a sunk cost?
A) a pair of jeans that are much too tight
B) a basket of apples that will spoil in a week
C) an application fee for college
D) a refundable deposit on a hotel reservation

Question

Quizplus · Accepted Answer

A sunk cost refers to money that has already been spent and cannot be recovered. The application fee for college, once paid, cannot be refunded regardless of whether the applicant is accepted or decides to attend, making it a sunk cost.

Which of These Items Would Be Best Categorized as a Sunk