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Economicsecon-003P0

Output tokens are significantly more expensive than input tokens.

GPT-4o charges $15.00/MTok for output vs…GPT-4o charges $15.00/MTok for output vs $5.00/MTok for input — a 3x premium. Constraining max_tokens from 4096 to 500 saves $11.25 per million requests.

Context & Methodology

Without output length constraints, LLMs generate verbose responses that consume the most expensive billing vector — output tokens — at 3x the input rate.

Applicable Use Cases

analysis

Applies To

openaianthropicgoogle

Primary Impact

cost

Confidence Level

High

Platform Status

Built

Implementation Effort

low

Recommendation

follow

Execution Priority

P0

Put This Evidence to Work

Use the STCO framework to implement findings like this in structured, testable prompts.

OpenAI text-embedding-3-small costs $0.02/MTok vs $15/MTok for GPT-4o output.OpenAI, 'Embeddings' pricing documentation, 2024