Original source: SimoleonSense.com .
My friend the Finance Professor found an interesting paper.Mental Accounting and False Reference Points in Real Estate Investment Decisions by Seiler, Lane, and Seiler.
Take a look at this excerpt
“If people were rational utility-maximizers, the decision to sell an asset would be independent of the price that was paid for the asset. The price paid in the past is a sunk cost, and should therefore be irrelevant to future buy/sell/hold decisions.”
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