Sunk costs are important while making decisions, but they are not important when assessing results.
In economics and commercial decision-making, a cost that has already been incurred and cannot be recovered is referred to as a sunk cost. Sunk costs are expenses that can no longer be avoided if future action is taken; they are contrasted with prospective costs. In other words, a sunk cost is an expense from the past that is no longer relevant to decisions being made about the present. Consumers frequently factor past costs for things like fixing a car or house into their future decisions involving those properties in daily life, even though economists claim that sunk costs are no longer important for making future rational decisions. Only prospective (future) costs are relevant to a rational decision, according to classical economics and conventional microeconomic theory.
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