Estimating LLM API Costs and Token Budgets Quiz

Answers and explanations appear as you take the quiz.

1. In English, roughly how much text does one token represent on average?
   • About one full sentence
   • About four characters, or three quarters of a word
   • Exactly one word
   • About one paragraph
2. Which type of token is usually priced higher by LLM API providers?
   • Input tokens
   • System prompt tokens
   • Cached tokens
   • Output tokens
3. At a hypothetical price of $3 per million input tokens, what do 2,000 input tokens cost?
   • $0.006
   • $0.06
   • $0.0006
   • $6.00
4. Why do chat conversations get more expensive as they get longer?
   • Providers charge a fee for each turn in a conversation
   • Output tokens get more expensive later in a conversation
   • The full conversation history is resent as input on every turn
   • Models slow down and bill by the second
5. How are the internal thinking tokens of reasoning models typically billed?
   • They are free because users never see them
   • They are billed as output tokens even when not shown
   • They are billed as input tokens
   • They are billed at a flat daily rate
6. Using the guide's worked example of $0.012 per request and 10,000 requests a day, what is the cost for a 30-day month before overhead?
   • $360
   • $1,200
   • $36,000
   • $3,600
7. What is the effect of capping conversation history or summarizing older turns?
   • It flattens the growth of input tokens as conversations get longer
   • It raises the output price per token
   • It removes the need to count tokens
   • It turns output tokens into input tokens
8. Besides cost, which API limit does the guide say can cap throughput?
   • A limit on the number of distinct users
   • A limit on the number of system prompts
   • Rate limits measured in tokens per minute
   • A limit on how many languages you can use