How to Calculate AVC?
This article will explain How to Calculate AVC?
What is Average Variable Cost?
In economics, Average Variable Cost (AVC) is the variable cost per unit.
Variable costs are company expenses that vary over time, such as labor, electricity and utilities.
As the Average Variable Cost, the firm can sell its products in a lower price.
What is The Formula of Average Variable Cost?
The Average Variable Cost equlas to variable costs of production (VC) divided by the quantity (Q) of output produced:
AVC = VC / Q
How to Calculate AVC?
First Step: Find AVC (The Average Variable Cost)
Second Step: Find Q (The quantity (Q) of output produced)
Divide AVC by Q
Example of Average Variable Cost
Given the following Data:
The Variable Costs of Production (VC): $ 10,000.00
The Quantity of Output Produced (Q): 200.00
The Average Variable Cost (AVC) equals to 50.00
(10,000.00 / 200.00)
To find out How to Calculate AVC you could also use our AVC calculator