Sunk cost

User Generated

ybbcf79

Economics

Description

A sunk cost is a cost that has already been incurred and thus cannot be recovered. A sunk cost differs from future costs that a business may face, recovered. A sunk cost differs from future costs that a business may face, such as decisions about inventory purchase costs or product pricing. Sunk costs are excluded from future business decisions, because the cost will be the same regardless of the outcome of a decision. When making business decisions, organizations consider relevant costs, which include the future cost and revenue of one choice compared with another. To make an informed decision, a business only considers the costs and revenue that will change as a result of the decision. Do you think this is how companies act in the real world?

User generated content is uploaded by users for the purposes of learning and should be used following Studypool's honor code & terms of service.

Explanation & Answer

Attached.

Surname 1
Name:
Institution:
Instructor:
Date:
Market Analysis
Response 1
Yes, many businesses are only interested in the revenue they can generate and the
possible cost which might end up draining the business. When the management is making the
decisi...


Anonymous
Really great stuff, couldn't ask for more.

Studypool
4.7
Trustpilot
4.5
Sitejabber
4.4

Related Tags