Economics is the study of how people make decisions about allocating limited resources to meet their needs and wants. Within this framework of decision-making, opportunity cost is an important concept. Put simply, opportunity cost is the cost of not choosing one option over another. In other words, it is what must be given up to pursue one particular decision. It is the potential benefit or value that one misses out on by not selecting a different activity or investment. For example, if you are deciding between going to the beach or going to a movie, each option has its own associated costs (such as tickets, gas, etc.) – but more importantly, there are foregone opportunities in not picking the other option (the beach or movie). Opportunity cost occurs with every decision and helps us weigh our options before making a final choice.