Cost refers to the reduction of resources one has to do in a trade in order to gain something in return. Typical situations are when one is recruiting creatures, constructing a building or hiring heroes. Most common resource used in trades is gold, which is needed for everything. Wood and ore are typically needed to construct buildings. Mercury, sulfur, crystals and gems (otherwise known as magical resource) are also commonly used in building construction, specially for mage guilds, but they are also sometimes needed to hire 7th level cretures.
Cost is given in the following order: gold, wood, ore, mercury, sulfur, crystal and gem. For example, a tavern cost is given as "500 and 5 ". This means, that is a player decided to build a tavern, the given amount of resources are reduced from kingdoms "treasury".