Kevin is re-finishing an antique grandfather clock that he ...

[Jramos095]

Kevin is re-finishing an antique grandfather clock that he purchased at a flea market for $300. He expects to be able to sell the clock for $450. At the last minute, Kevin discovers that he needs to repair the gears at a cost of $175 to make the clock worth $450 to potential buyers. It turns out that he could also sell the clock now, without completing the additional repairs, for $250. What should Kevin do?
◦ He should sell the clock now for $250.
◦ He should keep the clock but not make the repairs since the original $300 is a sunk cost.
◦ He should complete the additional repairs and sell the clock for $450.
◦ He should keep the clock after making the repairs since it is not rational to spend a total of $475 on an item that can only be sold for $450.
◦ Kevin is indifferent between selling the clock as is or selling it after completing the repairs.

[jessofishing]

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[Jramos095]

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[jessofishing]

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