With an initial investment of $3 million, a construction company has begun to develop a new bridge over Hudson River. The financial crisis hit the construction sector hard and, thus, had detrimental effects on the construction project itself. If the company abandons the project, then the initial investment is translated as a loss. If they want to continue the project, then an additional $3 million is necessary. The executive manager decides to overcome the loss and continue with the construction of the bridge. How can the executive manager’s decision be explained?
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