Glossary: LLM Cost Terms (Explained Simply)

Short definitions for stakeholders. Keep it non-technical and decision-oriented.

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Terms

  • DAU: Daily Active Users
  • Requests per user: Frequency of interaction
  • Response length band: Approximate size of AI output
  • Base vs High scenario: Expected vs Stress case
  • Guardrail: Safety limit for budget
  • Model comparison: Evaluating cost/performance trade-offs

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