Identify each of the following situations as involving sunk costs, opportunity costs, and/or cannibalization. Indicate what amount, if any, of these items would be relevant to the given investment decision.

a.The investment requires use of additional computer storage capacity to create a data warehouse containing information on all your customers. The storage space you will use is currently leased to another firm for $37,500 per year, under a lease that can be concealed without penalty by you at any time.

b.An investment that will result in producing a new lighter-weight version of one of the firm