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Actually, understanding sunk costs may have saved the Concorde rather than killing it. I'm using entirely made up numbers just as an example -- let's say that h
by listenallyall 5y ago
Actually, understanding sunk costs may have saved the Concorde rather than killing it. I'm using entirely made up numbers just as an example -- let's say that halfway through development, new estimates of total project costs were $1 billion and total revenue was only projected to be $750 million. Shut it down? Nope, because the first half-billion has already been spent. At this point, the options are to stop and get zero, or spend the second half-billion to see a 750m return. So work continues.
- deleted 5y ago[deleted]
- chii 5y ago> spend the second half-billion to see a 750m return or spend the 2nd half-billion on another project that returns more than 750m. Decisions should be made holistically, and consider all opportunity costs.