Updated · Methodology: named formula library
Tool-Use API Cost
Estimate cost when LLM calls external APIs (function calling).
Tool Calls to Tokens/Call = 3:500 (0 as decimal).
Tool Use Cost
Each tool round-trip: prompt → LLM decision → tool call → result → LLM continuation. Adds 2–5× tokens vs single-shot. Budget for 5,000–15,000 tokens per agentic task.
Worked Example
3 Tool Calls to 500 Tokens/Call
- a
- 3
- b
- 500
- Result
- 3:500 (0.01)
3 / 500 = 0.01. Simplified: 3:500.
When to Use This Calculator
- Plan budgets for agent SDK applications
Limitations & Common Mistakes
- Results are estimates from your inputs.
- Verify with current data for major decisions.
Frequently Asked Questions
How is the Tool-Use API Cost computed?
Tool Calls divided by Tokens/Call, plus a simplified ratio (e.g., 4:3) using greatest common divisor. Both decimal and ratio forms are useful in different contexts: decimal for math, ratio form for comparisons or recipe scaling.
What does Tool Calls:Tokens/Call mean?
It's a comparison: for every Tokens/Call unit, you have a corresponding amount of Tool Calls. Useful when the absolute numbers matter less than the proportion (e.g., reading 8:1 LTV/CAC immediately tells you the unit economics are healthy without needing the dollar amounts).
Why simplify the ratio?
4:3 is more readable than 200:150. The simplified form (using greatest common divisor) preserves the proportion while making it easier to interpret. Common simplified ratios: 16:9 (widescreen), 4:3 (legacy displays), 3:1 (LTV:CAC for SaaS).
When is a ratio more useful than the absolute values?
Comparison across scales. A $1B company and a $1M company can both have a 3:1 LTV:CAC; the ratio reveals comparable unit economics regardless of scale. Use ratios for benchmarking; use absolute numbers for budgeting.
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