Coefficient of Variation, Variance, and Mean: Understanding the Relationship | Test Prep

Variance of Y in Relation to Coefficient of Variation | CFA Level 1 Exam

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Question

The coefficient of variation of X is three times that of Y. If X and Y have the same means, the variance of Y is:

Answers

A. none of these answers.

B. same as that of X.

C. three times that of X.

D. one-third that of X.

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Explanations

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A. B. C. D.

The coefficient of variation equals the ratio of the standard deviation to the mean. Hence, if X and Y have the same means, then the standard deviation of X must be 3 times the standard deviation of Y.

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