The measurement is defined as the adjusted cohort graduation rate (ACGR), and it is designed to be a more accurate estimate of the on-time graduation rate than the AFGR.
This is because on average, the AFGR is an overestimate of the graduation rate in some states and an underestimate in others, and these misestimates tend to offset each other.
The second point however is that while the AFGR may be reliable on a national level, it may not provide a good estimate for any given state.
In addition to the dependent variables (SAT, AFGR, and PPE) and the
Figures 2 and 3 plot New Mexico's AFGR and per pupil
where y is the state-year average SAT score, AFGR, or PPE; s
in AFGR should be applied to the freshman class, which is presumably