Which One of the Following Decisions Most Clearly Reflects a Lack

question 39

Multiple Choice

Which one of the following decisions most clearly reflects a lack of understanding of the concept of sunk costs?

• A) You pay to have your car towed back to the repair shop because it was not fixed properly the first time.
• B) You decide to get a master's degree because you cannot find a job in the field in which you majored.
• C) You decide to purchase a piece of machinery for your business that will eliminate three employees' positions.
• D) You study eight hours for a final exam even though there is no way now that you can pass the course.

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Definitions:

Actual Performance

The real results or outcomes achieved by an individual, team, or organization, often compared against planned or expected performance.

Projects

Temporary endeavors undertaken to create a unique product, service, or result.

One-Time Activities

Events or actions that occur only once and are not repeated in the foreseeable future.

Beginning And End Points

These are the start and finish lines in a process, project, or activity, defining the scope and limits of the undertaking.