Question

Sunk costs:
A) have future implications.
B) are relevant.
C) are ignored when evaluating alternatives.
D) are differential.

Answer 1

Answer:

The correct answer to the following question is option C) this cost is ignored when evaluating alternatives .

Explanation:

Sunk cost which is also know as retrospective cost, where it can be described as a cost that business has already incurred and this cost cannot be recovered . These cost are usually ignored when decisions regarding future business are being taken , the reason behind this that the business will have to incurred this cost and it will remain the same no matter what decision is being taken .