3. Sunk costs and decision making
Lorenzo has plans to go to an opera and already has a $100 nonrefundable, nonexchangeable, and nontransferable ticket. Now Neha, whom Lorenzo
has wanted to date for a long time, asks him to a party. Lorenzo would prefer to go to the party with Neha and forgo the opera, but he doesn't want to
waste the $100 he spent on the opera ticket.
From the perspective of an economist, if Lorenzo decides to go to the party with Neha, what has he just done?
Incorrectly allowed a sunk cost to influence his decision
Made a choice that was not optimal
Correctly ignored a sunk cost
Points:
0/1