Sunk Costs

Overview:

In this lesson, we will look at the concept of sunk costs. In particular, students will compare “rational” economic decision-making to “irrational” commitment to inefficient outcomes. Using the article “Strong Leaders Encourage Dissent, and Gain Commitment,” students will take time to reflect on their own experiences with sunk costs. Finally, students will look at several economic rationalizations, classifying each as “economically rational” or not.

NBEA Standard(s):
  • Economics, I. Allocation of Resources
  • Economics, IV. Markets and Prices

Lesson Plan Details:

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