The sunk cost fallacy is a cognitive bias where individuals continue investing in a decision based on prior investments, such as time, money, or effort, rather than evaluating the current situation. This often leads to irrational choices, as people feel compelled to justify their past commitments, even when it would be wiser to cut their losses. For example, if someone has spent a lot of money on a concert ticket but feels unwell on the day of the event, they might still go to avoid wasting the ticket cost. This decision can result in further discomfort, illustrating how the sunk cost fallacy can hinder rational decision-making.