Short-run Average Variable Cost Curve (SRAVC)
Average variable cost (which is a short-run concept) is the variable cost (typically labor cost) per unit of output: SRAVC = wL / Q where w is the wage rate, L is the quantity of labor used, and Q is the quantity of output produced. The SRAVC curve plots the short-run average variable cost against the level of output, and is typically drawn as U-shaped.
Read more about this topic: Cost Curve
Famous quotes containing the words average, variable, cost and/or curve:
“All the average human being asks is something he can call a home; a family that is fed and warm; and now and then a little happiness; once in a long while an extravagance.”
—Mother Jones (1830–1930)
“There is not so variable a thing in nature as a lady’s head-dress.”
—Joseph Addison (1672–1719)
“I favor the policy of economy, not because I wish to save money, but because I wish to save people. The men and women of this country who toil are the ones who bear the cost of the Government. Every dollar that we carelessly waste means that their life will be so much the more meager. Every dollar that we prudently save means that their life will be so much the more abundant. Economy is idealism in its most practical terms.”
—Calvin Coolidge (1872–1933)
“I have been photographing our toilet, that glossy enameled receptacle of extraordinary beauty.... Here was every sensuous curve of the “human figure divine” but minus the imperfections. Never did the Greeks reach a more significant consummation to their culture, and it somehow reminded me, in the glory of its chaste convulsions and in its swelling, sweeping, forward movement of finely progressing contours, of the Victory of Samothrace.”
—Edward Weston (1886–1958)