Total variable cost per unit of output is called:
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → Average variable cost
Average variable cost is TVC divided by output, that is, the variable cost per unit.
Option (1) Short run marginal cost — Incorrect. SMC is the change in total cost per unit of change in output.
Option (2) Average variable cost — Correct. AVC = TVC/q.
Option (3) Average fixed cost — Incorrect. AFC is total fixed cost per unit of output.
Option (4) Short run average cost — Incorrect. SAC is total cost per unit of output.
NCERT (2026-27), Introductory Microeconomics, Glossary: “Average variable cost – Total variable cost per unit of output.” Glossary: “Average fixed cost – Total fixed cost per unit of output.” Glossary: “Average cost – Total cost per unit of output.” Glossary: “Marginal cost – Change in total cost per unit of change in output.” |