Coefficient of Variation

4 important questions on Coefficient of Variation

What is a Coefficient of Variation, conceptually?

Its basically a way that allows you to compare 2 different datasets to tell you which one has more spread. Compared to its mean?

What is the difference between a Coefficient of Variation and a Standard deviation (and perhaps the Variance as well), if they all tell you how spread out the data is?

I think (but will get back on this) that it has to do with generalization of information. A standard deviation tells something about the spread of the datapoints around the mean, within a particular dataset. If you wanna compare 2 datasets and see how spread apart theyre datapoints are, the std might not be able to tell you that.

How do you calculate the Coefficient of Variation?

Divide the Std by the Mean (std / mean) * 100 (because it is expressed in percentages)
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How do you interpret the Coefficient of Variation?

A Coefficient of Variation (or C.V.) of 1.66% tells us that its datapoints are 1.66% spread out around the mean. Compare that to another CV of 1.11, and essentially it means that the 1.66 is more spread out.

So the bigger the CV, the more spread out the data is around the mean.

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