<Table> <Tr> <Td> </Td> <Td> This article needs additional citations for verification . Please help improve this article by adding citations to reliable sources . Unsourced material may be challenged and removed . (July 2010) (Learn how and when to remove this template message) </Td> </Tr> </Table> <Tr> <Td> </Td> <Td> This article needs additional citations for verification . Please help improve this article by adding citations to reliable sources . Unsourced material may be challenged and removed . (July 2010) (Learn how and when to remove this template message) </Td> </Tr> <P> In economics and business decision - making, a sunk cost is a cost that has already been incurred and cannot be recovered . </P> <P> Sunk costs (also known as retrospective costs) are sometimes contrasted with prospective costs, which are future costs that may be incurred or changed if an action is taken . In that regard, both retrospective and prospective costs could be either fixed costs (continuous for as long as the business is in operation and unaffected by output volume) or variable costs (dependent on volume). However, many economists consider it a mistake to classify sunk costs as "fixed" or "variable ." For example, if a firm sinks $400 million on an enterprise software installation, that cost is "sunk" because it was a one - time expense and cannot be recovered once spent . A "fixed" cost would be monthly payments made as part of a service contract or licensing deal with the company that set up the software . The upfront irretrievable payment for the installation should not be deemed a "fixed" cost, with its cost spread out over time . Sunk costs should be kept separate . The "variable costs" for this project might include data centre power usage, for example . </P>

A cost that has already been incurred and cannot be changed is called a(n)