Final answer:
The coefficient of variation is used to compare the variability of different data sets. It is calculated by dividing the standard deviation by the mean and multiplying by 100 to express it as a percentage.
Step-by-step explanation:
The coefficient of variation is a measure of relative variability and is used to compare the dispersion or variability of different sets of data. It is calculated by dividing the standard deviation by the mean and multiplying by 100 to express it as a percentage.
Let's say you have the stock prices for different stocks and want to calculate their coefficient of variation. The first step is to calculate the mean (average) and standard deviation of each stock price. Then, you divide the standard deviation by the mean and multiply by 100 to get the coefficient of variation. Here's an example:
Stock A: Mean = $50, Standard Deviation = $10
Coefficient of Variation for Stock A = (10/50) * 100 = 20%
Repeat this process for each stock to calculate the coefficient of variation.