Refer to the Case in Point involving General Motors' decision to fund the Allison Transmission "World Transmission Project." GM originally expected to spend approximately \(\$ 500\) million on the WT Project. After the project had been underway for several years, it became obvious that cost overruns would result in the project costing in excess of \(\$ 600\) million. By the time the overruns became known, GM already had spent over \(\$ 250\) million on the project. Further, Allison experienced some production problems with the new transmissions. The division's cash flows were negative.

Required Assume you are part of GM management. What factors would you consider in deciding whether to invest the additional \(\$ 100\) million to complete the WT Project? Discuss the factors in terms of the four categories of reasons for continuing to fund unsuccessful investments. What alternative(s) to abandoning the project might GM consider?