Which scenario best illustrates the concept of opportunity cost?

The concept of opportunity cost refers to the value of the next best alternative that is forgone when a decision is made. In this case, selecting to study for an exam rather than going to a party exemplifies opportunity cost perfectly. When a student decides to study, they sacrifice the enjoyment and social experience associated with attending the party. The benefit they would have gained from that social interaction and leisure time is the opportunity cost of their choice to invest time in studying. This scenario clearly highlights the trade-off between two competing activities—focusing on academic success at the possible expense of personal enjoyment.

In contrast, the other scenarios do represent choices but do not encapsulate the opportunity cost concept as cleanly. For instance, deciding to buy a phone instead of a tablet involves a direct monetary exchange, but it doesn't delve into what benefits are forfeited besides the item itself. Similarly, investing in stocks instead of bonds denotes a financial decision, but it primarily reflects varying risk profiles rather than highlighting opportunity cost in terms of personal trade-offs. Lastly, buying groceries instead of dining out represents another financial decision with its own implications but lacks the personal sacrifice associated with the enjoyment of different experiences, making it less illustrative of opportunity cost.