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Placeholder Lesson:
** This lesson is generated with AI assistance and approved by Danny Nelson. This lesson will communicate the essence of the topic for now until Danny can create a full lesson. **
A sunk cost refers to any expense that has already been incurred and cannot be recovered, regardless of future outcomes.
For instance, if you've paid for a non-refundable concert ticket but fall ill on the day of the event, the ticket price is a sunk cost.