A Sunk Cost Is a Cost That Has Already Been

question 82

True/False

A sunk cost is a cost that has already been incurred and that cannot be avoided regardless of what action is chosen.

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Definitions:

Marginal Cost

The change in total production cost that comes from making or producing one additional unit of a good or service.

Fixed Cost

Costs that do not change with the level of output produced, such as rent and salaries.

Profits

The financial gain obtained when the revenue from business activities exceeds expenses, costs, and taxes.

Collusion

An agreement, usually secretive, between two or more parties to limit competition and manipulate prices for their benefit.