Label each of the following statements as either true (“T”) or false (“F”).
1. An opportunity cost is the potential benefit that is lost by taking a specific action when two or more alternative choices are available.
2. A sunk cost will change with a future course of action.
3. An out-of-pocket cost requires a current and/or future outlay of cash.
4. Relevant costs are also known as unavoidable costs.
5. Incremental costs are also known as differential costs.