Question

Which of the following is a common mistake made by consumers? Group of answer choices ignoring sunk costs being overly optimistic about their future behavior being overly pessimistic about their future behavior taking into account the implicit costs of an activity

Answer 1

Answer: Ignoring sunk cost

Explanation: Of the options listed in the question above, a common mistake being made by consumers is their failure to ignore cost, which are expenses or cost which have already been incurred and no longer redeemable. Consideration of already incurred and no longer redeemable affects future purchase or investment decisions made by some consumers, hence leading to an effect on the prospective cost which refers to cost which is to be incurred at a later time or in the future.