# average variable cost

﻿
average variable cost
An average taken over a specified period of the variable cost of producing units of production (see average cost). The variable costs (such as the cost of raw materials, direct labour, machine time, etc. ) of producing a unit are those that vary directly with the number of units produced. As they are likely to change from time to time it may be convenient for budgeting purposes to take an average.

Big dictionary of business and management. 2014.

### Look at other dictionaries:

• Average variable cost — (AVC) is an economics term to describe the total cost a firm can vary (labor, etc.) divided by the total units of output.:frac{ ext{TVC{ ext{Output = ext{AVC}Where: * TVC = Total Variable Cost * AVC = Average Variable CostAverage variable cost… …   Wikipedia

• Average fixed cost — (AFC) is an economics term to describe the total fixed costs (TFC) divided by the number of units produced. left ( frac{TFC}{Q} ight ) = AFC; TFC = total fixed cost, Q = quantity of units producedAverage variable cost plus average fixed cost… …   Wikipedia

• Long-Run Average Total Cost - LRATC — A business metric that represents the average cost per unit of output over the long run, where all inputs are considered to be variable. Long term unit costs are almost always less than short term unit costs because in a long term time frame,… …   Investment dictionary

• Cost-plus pricing — is a pricing method used by companies to maximize their profits. The firms accomplish their objective of profit maximization by increasing their production until marginal revenue equals marginal cost, and then charging a price which is determined …   Wikipedia

• Cost curve — In economics, a cost curve is a graph of the costs of production as a function of total quantity produced. In a free market economy, productively efficient firms use these curves to find the optimal point of production (minimising cost), and… …   Wikipedia

• Average cost — In economics, average cost is equal to total cost divided by the number of goods produced (the output quantity, Q). It is also equal to the sum of average variable costs (total variable costs divided by Q) plus average fixed costs (total fixed… …   Wikipedia

• Cost of goods sold — Accountancy Key concepts Accountant · Accounting period · Bookkeeping · Cash and accrual basis · Cash flow management · Chart of accounts  …   Wikipedia

• cost — The opposite of revenue. An expense that reflects the price of purchasing goods, services and financial instruments. A cash cost means that cash is given up today to the purchase. Also, the purchase price of an investment, which is compared to… …   Financial and business terms

• Cost-plus pricing with elasticity considerations — One of the most common pricing methods used by firms is cost plus pricing. In spite of its ubiquity, economists rightly point out that it has serious methodological flaws. It takes no account of demand. There is no way of determining if potential …   Wikipedia

• Variable universal life insurance — (often shortened to VUL) is a type of life insurance that builds a cash value. In a VUL, the cash value can be invested in a wide variety of separate accounts, similar to mutual funds, and the choice of which of the available separate accounts to …   Wikipedia