Response to the following problem:
You Decide: Should sunk costs be considered in a planning decision or ignored?
You currently work part time at a flower shop. You split your time between keeping the books and making deliveries. The van you use to make these deliveries has been in and out of the repair shop over the past two months. In addition to the engine, the transmission was just replaced. The mechanic said that the van is old enough to require constant repair. Your boss isn't too happy about all this repair work and was heard saying, "I would like to get a new van, but I can't afford it. I have invested too much money in the one we have now!" What should you tell your boss?