Define Sun Cost and Opportunity Cost ? how does they effect our decision making ?

Hi Sir. According to my understanding u mean sunk cost and oppertunity cost. A sunk cost is a cost that cannot be recovered.

An oppertunity cost is the amt the inv would have earned if invested somewhere else. When I invest $1 in producing salt say the return is $2. If I would have invested the same amt in sugar production the return would have been $1.5. This1.5 would be the oppertunity cost. I have invested in salt production as the oppertunity cost1.5 is less than the current return of2.

When the target is capturing the market or penetrating a new market oppertunity cost may not be the1st consideration . But in the long run it has to bea consideration.