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?
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