Difference between Costs and Effects

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Typically, costs are determined at activation, while effects are determined during resolution of the card.

Example: Cost[edit]

"Magical Stone Excavation": Discard 2 cards, then target 1 Spell in your GY; add it to your hand.

Notice here, that the controller is required to discard 2 cards in order to meet the activation condition for the card in question. Then, during resolution, the Spell Card is added to the hand.

Example: Effect[edit]

"Graceful Charity": Draw 3 cards, then discard 2 cards.

Now here, there is technically no cost for activating the card, since drawing cards is not considered a cost. This also means that the two-card discard is treated as an effect.