Tag Archives: sunk-cost

Usefulness of Sunk Costs

In an earlier article, we defined sunk costs, and observed that attributing too much importance to sunk costs leads to the sunk cost fallacy. Is there any use at all in considering sunk costs? In some cases, yes. To see … Continue reading

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Poker

Poker is an interesting card game involving aspects of risk-taking, skill, chance, probability and psychology. This game serves to illustrate two concepts we have discussed before – randomness and sunk-costs. The following discussion will refer to the “Texas hold ’em” … Continue reading

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Sunk Costs

A sunk cost is an investment into an enterprise or scheme that has already been committed. It cannot be reverted. For instance, consider the act of reading a book. The number of hours you spend reading a book is the … Continue reading

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