It's very simple ... you're given two choices and you pick the one that suits you best (and give a brief explanation as to why it suits you better than the other choice did).
The 'options' should be somehow in the same ballpark, thematically, too. In other words, asking someone to choose between wild elephants and chocolate chip cookies is (while interesting) pretty much more odd than it is sensible. Choosing between wild elephants and peevish kangaroos would work, however. Or, say, chocolate chip cookies and scrambled eggs. Etcetera. The sky's the limit on *theme*, really - so be as creative as you wish without getting too "out there" to make playing the game entirely weird. I, personally, would have no problem comparing elephants to cookies. Some others might, though (or maybe not -- we'll see how it goes, yes?).
After you make your choice, by the way, be sure to offer two choices of some other somethings to the next player.
Last few posts:Neither is a favorite, but I've seen more basketball, so I'll take hockey.

Lifesavers: Cherry or pineapple?
--------------------
Cherry but pineapple is yummy too
Ping pong or pinball?
--------------------
Pinball, for sure.
Hide and seek or freeze tag?
--------------------
Hide & Seek.
Card games or Board?