This document defines and explains various cost concepts that are important for business decision making. It discusses the differences between future and past costs, incremental and sunk costs, out-of-pocket and book costs, historical and replacement costs, explicit and implicit costs, actual and opportunity costs, direct and indirect costs, shut down and abandonment costs, and private and social costs. The key message is that different types of costs are relevant for different business problems, so it is important to use the right cost analysis approach.