The sunk cost fallacy is the:
A) principle that sunk costs matter more and more with the passage of time.
B) mistaken belief that one should consider sunk costs when making decisions.
C) idea that people ignore experience when making future decisions.
D) correct belief that past investments can be recovered from future actions.

Question

Quizplus · Accepted Answer

The sunk cost fallacy is the mistaken belief that one should consider sunk costs, which are past costs that have already been incurred and cannot be recovered, when making decisions. This fallacy leads individuals to continue investing in a project or decision based on the amount already invested rather than on future benefits and costs.

The Sunk Cost Fallacy Is The