In the context of personal finance, how should an individual evaluate a long-term investment opportunity when considering sunk costs and opportunity costs?

When evaluating a long-term investment, it's important to understand two key concepts: sunk costs and opportunity costs. Sunk costs are the money you have already spent on something that cannot be recovered, like a deposit on a project that didn't work out. This means you shouldn't let those past expenses influence your decision about future investments. Opportunity costs, on the other hand, refer to what you give up when you choose one investment over another, such as the potential earnings from a different investment you could have made. For example, if you have $1,000 to invest and you choose one stock that might return 5% a year, the opportunity cost is the returns you would have earned from another stock that could return 10% a year; thus, it's crucial to consider these factors to make the best financial decision.