Building on sunk assets

I don't know that much about economics, but I do have (a bit of) common sense. In a Harvard Business School article, Clayton Christensen writes about "How Will You Measure Your Life?" It ends with a bit of religion inspired thinking (to which I, even as an atheist, can somewhat relate to (stay true to your principles)), but let's not focus on that. The start of the story is on how to think of investments, and how different thinking about investing is between start-ups (with few assets) and established companies. He takes Blockbuster as an example (an old-style video-rental store in the USA):

> Blockbuster's mistake? To follow a principle that is taught in every fundamental course in finance and economics. That is, in evaluating alternative investments, we should ignore sunk and fixed costs, and instead base decision…