Multiple choice

An expenditure that has been made and cannot be recovered is called

  1. variable cost

  2. opportunity cost

  3. sunk cost

  4. operational cost

Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

A sunk cost is a cost that has already been incurred and cannot be recovered. Because it cannot be changed by any future decision, it should ideally be ignored in rational decision-making.