The calculation of Coefficient of Variation is important because standard deviation can only be used to measure dispersion present in two distributions in case the mean and the units of measurement of both the distributions are same. Therefore a relative measure is needed that will give the quantity of dispersion relative to the quantity of mean. This relative measure of dispersion is called Coefficient of Variation. Coefficient of Variation was introduced by Karl Pearson. It is always expressed in percentages and is used to compare the stability or consistency of two groups having the same variable.
Coefficient of Variation can be calculated by using the formula:
Problems: Two graduate students worked on five similar projects during their study program. Student A completed each project in 30 days with standard deviation of 4 days. On the other hand student B completed each project in 25 day with standard deviation of 6 days. Which student is more consistent?