Yeatman spent 2750 on a marketing study to estimate the numb

Yeatman spent $2,750 on a marketing study to estimate the number of units that it can sell each year. What should Yeatman do to take this information into account? Increase the amount of the initial investment by $2,750. Increase the NPV of the project $2,750. The company does not need to do anything with the cost of the marketing study because the marketing study is a sunk cost.

Solution

Third option is correct. Marketing study is a sunk cost hence no need to take into account.