Coefficient of Variation - Assignment Example

1. The coefficient of variation is a relative measure of variability. Compared to absolute measures such as the standard deviation or the mean deviation, the advantage of the coefficient of variation is that it can be used to compare extents of variation across samples that use different measuring units or samples that have substantially different means. For instance if there were three stores A, B and C which were located in places so that the mean weekly sales revenues were drastically different, simply comparing the standard deviations of the sales would not provide clear picture of the true differences in variability across these stores.

Instead by computing the coefficient of variation for each store and comparing these would actually show the consistency of each store regarding sales performances. 2. I would use the formula for coefficient of variation for each survey. So for each survey first the standard deviation and then the mean of the weekly sales would be computed and then we would look at the ratio of standard deviation to mean for each survey. For survey 1, the mean is 9589.34 and the standard deviation is 7868.57039.

Thus the coefficient of variation for the weekly sales for survey 1 is 0.820553906.For survey 2, the mean is 21183.34 and the standard deviation is 12504.34183. Therefore the coefficient of variation is equal to 0.514423687Finally, for survey 3, the mean is 20158.02 and the standard deviation is 7458.161934 and thus the coefficient of variation is 0.369984908. Comparing the coefficients of variation we find that the survey 3 results exhibit the least variability followed by survey 2. The variability of the survey 1 data is the maximum.