What is a sunk cost?

A sunk cost is a cost that has already been incurred by a business or an individual and cannot be recovered by any means. They should not be considered while making an investment decision or while doing any projections.

The logical decision here would be to let the sunk costs go and not let them influence the future course of action for the company. If the company realizes that a cheaper variant is not achievable in the stipulated time, then investing a little more in it would add to the losses.

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