Cost of production definitions clarify measures for average, variable, avoidable and long run costs under competition regulation.

The regulations define cost metrics for competition assessment: total cost includes all actual production costs attributable to the product; total variable cost is total cost minus fixed costs and attributable fixed overheads; average total and average variable cost are these totals divided by output; total and average avoidable cost measure costs that could have been avoided for extra output; marginal cost is the cost change from one additional unit; and LRAIC covers all variable and fixed costs, including sunk and product specific fixed costs and a proportionate share of common costs for multi product firms.

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