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WorksheetsSunk Costs Quiz
Total questions: 9
Worksheet time: 10mins
What are costs that have already been incurred, that can never be recovered, called?
lost costs
sunk costs
dead costs
wasted costs
What is an example of NOT understanding sunk costs? (2 answers)
Buying a second Big Mac and eating it.
Cleaning your plate, even though you are not hungry anymore, because there are "starving children in Africa."
Buying a more expensive prom dress because it will make you look nicer.
Sending soldiers to war because not doing so would dishonor those who have already died.
What is the difference between opportunity cost and sunk cost?
Sunk cost is a cost already incurred
The opportunity cost is the best alternative not selected.
Opportunity cost deals with a future choice, while sunk cost is a choice already made.
What is another way of describing the sunk cost fallacy? (two answers)
Don't put all your eggs into one basket.
I can't stop now, otherwise what I've invested so far will be lost.
Don't throw the baby out with the bath water.
We've come this far; there's no turning back.
If you purchase a non-refundable movie ticket in advance, then later feel like you would rather not go out but stay home, what should you do?
Go to the movies because you've already paid for the tickets and you don't want to waste them.
Stay home because the benefits outweigh the cost.
If a scalper offers you $500 for a concert ticket you paid $100 for, and you DON'T accept his offer, then
you made a really poor business decision.
you don't understand economics.
that $100 ticket is now worth $500.
When you are eating at a restaurant, and you are full, and can't take the food home, you should
finish the food because of the starving babies in Africa
clean your plate because it is disrespectful not to.
stop eating
When deciding whether to send more troops to a war, a US president should
continue to send troops because pulling out would dishonor the memory of those who have died for their country.
send more troops because pulling out would make the US look weak.
decide based on whether the future benefits to the US are likely to outweigh the additional cost in lives lost and money spent.
How should you decide whether to breakup with someone that you are in a relationship with?
You should not breakup with someone if you have been dating longer than 6 months because of all the time you invested in the relationship.
If you made a promise to someone that you would love them forever, you need to keep that promise no matter what.
You should break up with them if you predict that the benefits of staying in the relationship are less than the costs.
