Glossary · Micro · Production and costs

Average fixed cost (AFC)

Fixed cost per unit of output, . It keeps falling as output grows because the same rent is spread over more units, which is the gap between the ATC and AVC curves shrinking.

Also called: AFC

Taught in: Average and Marginal Cost

Related terms

Fixed cost (FC)Average total cost (ATC)Average variable cost (AVC)

More from production and costs

Average product of labor (APL)Cobb-Douglas production functionEconomies and diseconomies of scaleIsoquantLaw of diminishing marginal returns

Definitions are the start

See the term used, not just defined.

The full course teaches every term in context, with worked examples, interactive graphs and practice questions that remember what you get wrong.
Read the lessonStart the course