What Is an Average Fixed Cost?

The short-term average cost can be divided into average fixed cost and average variable cost. The average fixed cost is the average fixed cost per unit of product. It is expressed by AFC: the average fixed cost decreases continuously with the increase of output, and its curve is a positive hyperbola. The law of average fixed cost changes is that the reduction is large at first, and the decrease is smaller and smaller in the future. Therefore, the average fixed cost curve is relatively steep at first, which indicates that when the output starts to increase, it decreases by a large amount, and then becomes more and more flat, which indicates that as the output increases, it decreases less and less.

Average fixed cost

Cost can be divided according to calculation basis

The average cost is the cost per unit of output, specifically:

Average total cost = total cost /

Definition of fixed costs

Average fixed and variable costs

The law of average fixed cost changes is that the reduction is large at first, and the decrease is smaller and smaller in the future. Therefore, the average fixed cost curve is relatively steep at first, which indicates that when the output starts to increase, it decreases by a large amount, and then becomes more and more flat, which indicates that as the output increases, it decreases less and less.