Formula for Average Variance Extracted?

The average variance extracted (AVE) calculated as follows: total of the squared multiple correlations plus the total sum of each variable, then divides it by the number of factors in that variable.

How do you calculate average variance?

The variance is the average of the squared differences from the mean. To figure out the variance, first calculate the difference between each point and the mean; then, square and average the results. For example, if a group of numbers ranges from 1 to 10, it will have a mean of 5.5.

What is a good average variance extracted?

As a rule of thumb and for adequate convergent, an AVE of at least 0.50 is highly recommended. That been said, an AVE less than 0.50 means your items explain more errors than the variance in your constructs. For any measurement model, an AVE must be calculated for each construct and must be at least 0.50.