A cost that cannot be recovered at the time a decision is being made is termed a(n)
A) marginal cost.
B) scarcity cost.
C) sunk cost.
D) average cost.
E) opportunity cost.

Question

Quizplus · Accepted Answer

A sunk cost is a cost that has already been incurred and cannot be recovered, and therefore should not be considered in a decision-making process. Marginal cost is the additional cost of producing one more unit, scarcity cost is not a commonly used economic term, average cost is the total cost divided by the number of units produced, and opportunity cost is the cost of the next best alternative foregone.

A Cost That Cannot Be Recovered at the Time a Decision