A mother has signed up her child for summer camp, and paid a $500 nonrefundable fee.
Then the child asserts, "I don't want to go to the camp after all."
The parent responds, "No way: I paid for the camp ready, and you're going!"
The kid comes back with, "But mom, that is a sunk cost. It is irrelevant."
Is the kid right, and parents have been wrong all these years when invoking the "I paid for it already" principle?
No, in this case, paying attention to the "sunk costs" is a method of checking future, potentially frivolous, signing up for things. If the child knows that he is going to have to attend any activity that has been paid for, he will think carefully about what to sign up for.