“The sunk cost effect is the general tendency for people to continue an endeavor, or continue consuming or pursuing an option, if they’ve invested time or money or some resource in it,” says Christopher Olivola, an assistant professor of marketing at Carnegie Mellon’s Tepper School of Business and the authorRead More →
“Ozymandias” is at heart a metaphor. The statue represents the kings and kingdoms of the past, subject to the ravages of time, nature, and their own failings. The description of the statue and its inscription reveals tremendous pride and lost power. The statue, once magnificent, lies in ruins in theRead More →
A pelagic trawler, Antares was fishing for herring and mackerel. It had landed fish at Largs over two days before heading out across the Forth of Clyde on the night of November 21. … At around 2.20am the nets of Antares were snagged by the submarine, and the fishing boatRead More →
Relevant Costs and Sunk Costs Since they’re seeking to measure future cash flows, analysts must be careful to avoid including sunk costs. Since sunk costs are costs the firm has already incurred, they shouldn’t be included in future cash flows. Are sunk costs included in total cost? In both economicsRead More →
Stranded costs are calculated as the difference between sunk costs (usually book values) and the present value of expected operating earnings from those sunk assets. … The utility will seek to recover those costs from remaining customers in the new policy environment. See stranded assets. What is a non recoverableRead More →