Definition, Meaning & Synonyms
sunk-cost
Noun
/sʌŋk kɔːst/
Definition
A sunk cost is an expense that has already been incurred and cannot be recovered.
Examples
- Despite the sunk costs, the company decided to discontinue the project.
- Investors often struggle with how to handle sunk costs when making financial decisions.
- It’s important to recognize sunk costs to avoid falling into the trap of continuing bad investments.
Meaning
Sunk costs refer to the resources that have already been spent and cannot be retrieved. They are often considered in decision-making processes to determine the future course of action, despite being irrelevant to the decision at hand.
Synonyms
- irrecoverable cost
- non-recoverable expense
- lost investment
