Should the International Space Station be Shelved?
Over a decade ago, the United States joined the European Union, Russia, Canada, and Japan, in a effort to build the International Space Station. Initial cost estimates pegged a figure of $100 billion. For the sake of this example, suppose that officials expected the space station to yield benefits of $400 billion.
Imagine that the benefit estimate appears to be correct, but costs to date total $250 billion, and the space station still is not ready. The cost of completing the space station, X, is uncertain. Congressman Jones wants to stop now: "Whatever the value of X, it is clear that the space station will yield negative net benefits." Congresswoman Smith wants to continue: "If we stop now, we will have wasted $250 billion." Comment. How should the decision depend on the value of X?
1 comment:
This goes back to one of the beginning chapters. The money that is already spent is just that. It can't be taken back wither or not the space station is stopped or not. You are not supposed to look at what is alread lost when making a decision. The space station should close because in the end there will be a negative net benefit. The $250 billion is already lost no matter what is done. Why waste more.
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