What is an opportunity cost? Give an example. Do opportunity costs only occur when people make spending decisions?

Opportunity cost refers to the value of the next best alternative that is forgone when making a decision. For example, if you spend $50 on a concert ticket, the opportunity cost might be the dinner you could have enjoyed instead. Opportunity costs occur not only with spending decisions but also with time and resource allocation, as every choice made involves sacrifices of alternate options, whether in leisure, investments, or career paths.