Coefficient of Variation
Normal variation is an absolute measure of dispersion. When comparability must be made between two collection then the relative measure of dispersion, generally known as coeff.of variation is used.
Coefficient of Variation, CV is outlined and given by the next perform:
The place −
- = Coefficient of Variation.
- = customary deviation.
- = imply.
From the next knowledge. Determine the dangerous mission, is extra dangerous:
|Undertaking X (Money revenue in Rs. lakh)||10||15||25||30||55|
|Undertaking Y (Money revenue in Rs. lakh)||5||20||40||40||30|
As a way to determine the dangerous mission, we’ve got to determine which of those tasks is much less constant in yielding earnings. Therefore we work out the coefficient of variation.
|Undertaking X||Undertaking y|
Since coeff.of variation is larger for mission X than for mission Y, therefore regardless of the typical earnings being identical, mission X is extra dangerous.