International Association of Accessibility Professionals (IAAP) Certified Administrative Professional (CAP) Practice Exam

Which term refers to the irrational persistence in a failing course of action due to prior investments?

1. Sunk cost fallacy

2. Escalation of commitment

3. Confirmation bias

4. Groupthink

The correct answer is: Escalation of commitment

The term that refers to the irrational persistence in a failing course of action due to prior investments is escalation of commitment. This concept describes a situation where individuals or groups continue to invest time, money, or resources into a decision or project despite evidence showing that it is failing. The commitment escalates as they hope that their continued investment will turn things around, primarily due to the desire to justify their earlier decisions and avoid realizing the losses associated with abandoning them. Understanding escalation of commitment is crucial in decision-making contexts, especially in business and management, where stakeholders might be influenced by the resources already spent rather than objectively assessing the situation to make the best choice moving forward. The phenomenon highlights the importance of being aware of biases that can affect rational thought processes and lead to poor choices. In contrast, the sunk cost fallacy involves the decision-making error of considering past costs that cannot be recovered when making new decisions, which is related but has a distinct nuance. Confirmation bias refers to the tendency to search for, interpret, and remember information in a way that confirms one’s pre-existing beliefs. Groupthink is a psychological phenomenon where the desire for harmony in a group results in irrational or dysfunctional decision-making. Each of these concepts offers insight into how cognitive biases can influence actions and