Stenbeck Chemical has spent $244,000 to refine 71,000 gallons of acetone, which can be sold for $2.00
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1. Diagram Stenbeck's decision.
2. Identify the sunk cost. Is the sunk cost relevant to Stenbeck's decision? Why or why not?
3. Should Stenbeck sell the acetone or process it into lacquer thinner? Show the expected net revenue difference between the two alternatives.
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