What is sunk cost?

Sunk cost — these are costs that have already been incurred and cannot be recovered or changed regardless of future decisions. In project management, it is important not to consider sunk costs when making decisions, so as not to continue investing in inefficient projects solely because of resources already invested.

Example: if a lot of money and time have been invested in a project, but it does not yield results, it is rational to stop it rather than continue to spend resources just because of the costs already incurred.