Average variable cost refers to:

Average variable cost is specifically defined as the variable cost incurred for producing each unit of output. It is calculated by taking the total variable costs associated with production and dividing that by the number of units produced. This measurement allows firms to understand how variable costs, which can change with the level of output, impact the overall cost per unit of production.

In contrasting this with the other concepts mentioned, total cost divided by units produced refers to average total cost, not average variable cost. Fixed cost per unit of output considers only the fixed costs in relation to output, which does not reflect the variability in costs associated with scaling production up or down. Finally, average total cost includes both fixed and variable costs and would not accurately represent the average variable costs on their own. Thus, the definition provided in the correct answer aligns precisely with the concept of average variable cost in microeconomics.