vnjones_wk6_d1.docx - Sunk cost is the cost which refers to...

This preview shows page 1 out of 1 page.

The preview shows page 1 - 1 out of 1 page.
Sunk cost is the cost which refers to the amount of money which has already been spent and could not be recovered in future. Opportunity cost is the value or benefit the business ready to give up upon choosing the next best available alternative over another. Sunk costs are not relevant to the decision making which a executive or manager has to take so that could determinewhat action plan will be taken [ CITATION Jia16 \l 1033 ]. These costs are acquired to do previous agreements though the circumstances or situations have changed since the agreement. This means that the management has changed after purchasing an equipment which is no longer required. This is where the opportunity cost come into highlight or important. The opportunity
End of preview. Want to read the entire page?

Upload your study docs or become a

Course Hero member to access this document

Term
Summer
Professor
n/a
Tags
Economics, Management, Sixth Edition

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture