This is an example of opportunity cost. A business, individual, or investor who chooses one alternative over another is missing out on potential benefits. It's easier to make better decisions when you ...

A trade-off is what you have to expend in order to pursue an option, while an opportunity cost is what you miss out on by not pursuing a better option. In the cookie example above, the trade-off ...

In this way, you are able to make more accurate economic decisions. What is the opportunity cost of a decision example? On the night before an exam, a student spends three hours and $20 at the movies.

It’s an everyday example of what advisers call “opportunity cost” — the difference between the money spent and what could have happened with that money. Instead of chips and a Coke ...