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    5. The costs which were incurred in the past and ignored under capital budgeting are known as_____. 

    Question

    The costs which were incurred in the past and ignored

    under capital budgeting are known as_____. 
    A Opportunity cost Correct Answer Incorrect Answer
    B Indirect cost Correct Answer Incorrect Answer
    C Sunk cost Correct Answer Incorrect Answer
    D Variable cost Correct Answer Incorrect Answer

    Solution

    Sunk costs are the costs which were incurred in the past. Sunk costs are irrelevant for decisions, because they cannot be changed and therefore are ignored under capital budgeting.

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