On Sep 3, 2009, at 8:30 AM, Ann Davis wrote:
Beginning principles of micro one more time............the focus on marginal costs and marginal benefits, ignoring sunk costs, seems to make very clear how micro is simply ignoring the problem of capital. If capital investment can be interpreted as "sunk costs," it is "irrelevant." Mainstream economics has left this question entirely to "finance" and to accounting, it seems.
According to the standard finance text I have lurking on some bookshelf somewhere, you should ignore sunk costs in evaluating a project's continued viability. So even finance isn't interested in the question!
Doug _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
