When Is It Appropriate to Include Sunk Costs in the Evaluation

question 40

Multiple Choice

When is it appropriate to include sunk costs in the evaluation of a project?

• A)Include sunk costs when they are relatively large
• B)Include sunk costs if it improves the project's NPV
• C)Include sunk costs if they are considered to be overhead costs
• D)It is never appropriate to include sunk costs

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Definitions:

Management Support

The assistance, guidance, and resources provided by managers to their teams, facilitating achievement of goals and improvement in performance.

Training Methods

Techniques and strategies used to facilitate the learning process and skill development, ranging from instructor-led training to online and interactive methods.

Valence

The perceived desirability or attractiveness of a reward or outcome, which influences motivation.

Negative Transfer

This occurs when learning in one context or task hinders or interferes with performance in another context or task.