Question 1 Descriptive statistics - Coefficient of Variation
Tivo Fast Moving Consumer Goods (FMCG) companies are in close competition these days
to become the undisputed leader of the industry. Both the companies produce and sell
multiple lines of products. The sales performance of both the companies in the context of
selling a non-alcoholic beverage is given below:
Company A
Mean Sales (One Year Average) - 5000 units
Standard Deviation - 500 units
Company B
Mean Sales (One Year Average) - 7500 units
Standard Deviation - 1000 units
Compute Coefficient of Variation (CV) for both the companies and comment on the result.
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The coefficient of variation (CV) is a statistical measure of the dispersion of data points in a data series around the mean. The coefficient of variation represents the ratio of the standard deviation to the mean, and it is a useful statistic for comparing the degree of variation from one data series to another, even if the means are drastically different from one another.
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