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Verbal·Information and Ideas·Inferences
easy
In economics, the “sunk cost fallacy” refers to the tendency of individuals to continue investing in a losing endeavor simply because they have already put significant resources (time, money, or effort) into it. A rational decision-maker, however, would ignore sunk costs and base future investments solely on the projected future return. For example, a business owner suffering from the sunk cost fallacy might __________
Which choice most logically completes the text?
A
to prevent any further financial losses.
B
refuse to launch a new product because a similar product failed ten years ago.
C
continue pouring money into a failing advertising campaign because they have already spent $50,000 on it.
D
base their next quarter’s budget entirely on the projected profits of their best-selling item.