The document discusses norm-referenced grading systems, where a student's performance is evaluated relative to other students in the group. It provides examples of how student scores in two hypothetical classes would be converted to percentiles. Specifically, it shows that a student who scored 75 in Class A would be at the 80th percentile, while a student with the same score of 90 in Class B would also be at the 80th percentile. The document also notes some difficulties with norm-referenced systems, such as differences in class ability levels that make direct score comparisons unfair.