Anthony Payne 5-28-2024.
Have you ever fallen into the trap of sunk cost? Well, I have!
Sunk Cost Fallacy
The sunk cost fallacy is a cognitive bias that causes people to persist in an endeavor or continue investing additional resources (money, time, effort, etc.) in something despite the fact that it may no longer be rational or optimal to do so. The reasoning behind this fallacy is that people tend to make decisions based on the resources they have already invested rather than rationally evaluating the future potential costs and benefits. The term "sunk cost" refers to the costs or resources that have already been incurred and cannot be recovered, regardless of any future course of action. These costs are "sunk" and should not influence future decisions, as they are irrelevant to the potential costs and benefits in the future. However, due to the sunk cost fallacy, people often feel compelled to continue investing resources in a failing endeavor simply because they have already invested so much and don't want their previous investments to go to waste. This line of thinking is irrational because the sunk costs are already gone and cannot be recovered, no matter what decision is made about the future. Examples of the sunk cost fallacy include: Continuing to watch a movie or read a book you're not enjoying simply because you've already spent time on it. Staying in an unhappy relationship because you've already invested years in it. Holding onto a losing investment in the hopes of eventually breaking even instead of cutting your losses. Completing a project or task that is no longer relevant or valuable just because you've already put in a lot of effort the rational approach would be to evaluate the potential future costs and benefits of continuing the endeavor without considering the sunk costs, as they are irrelevant to the decision at hand.
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