The average absolute deviation is used in calculating which of the following?

The average absolute deviation is a statistical measure that quantifies the dispersion of a set of data points. It is particularly relevant when calculating the Coefficient of Variation because this coefficient is a measure of relative variability. The Coefficient of Variation expresses the standard deviation as a percentage of the mean, providing a useful way to compare variability between different datasets, particularly when the means are significantly different. The average absolute deviation provides a foundation for understanding the spread of the data around the mean, which is essential when interpreting the Coefficient of Variation.

In contrast, the other options—Effective Tax Rate, Price-Related Differential, and Overall Rate—have different calculation methodologies that do not specifically involve the average absolute deviation. The Effective Tax Rate focuses on the ratio of tax paid to income, the Price-Related Differential assesses the equity of appraisal among properties, and the Overall Rate is connected to property valuation within the context of property tax calculations. None of these directly derive their calculations from the average absolute deviation, making the first choice the most pertinent.