A Sunk Cost

question 124

Multiple Choice

A sunk cost:

• A)is a cost that occurs in the present.
• B)is not categorized as a cost.
• C)is a relevant cost.
• D)is a cost that occurred in the past.
• E)is expected to occur in the future.

---

Definitions:

Central Bank

The principal monetary authority of a country, which manages the country's currency, money supply, and interest rates.

Flexible Exchange Rates

Exchange rates determined by the foreign exchange market, allowing the value of a currency to fluctuate according to supply and demand.

Bretton Woods Agreement

A 1944 agreement that established a new international monetary system, creating institutions like the International Monetary Fund (IMF) and the World Bank to ensure financial stability and promote economic cooperation.

Gold Standard

An economic setup where the worth of paper money or a country's currency is directly connected to the value of gold.