select Student, avg(cast(Grade as float)), max(Section) 'Section' 
from   #ClassAvge 
group by Student, Grade
order by Student

IF OBJECT_ID('tempDB..#ClassAvge') IS NOT NULL DROP TABLE #ClassAvge

CREATE TABLE #ClassAvge
(
	Student INT
	,Grade TINYINT
	,Section TINYINT
)
INSERT INTO #ClassAvge (Student,Grade,Section)
VALUES(1236, 78 , 1)
	,(4526, 83, 1)
	,(7785, 99, 1)
	,(4213, 72, 2)
	,(4213, 65, 1)
	,(7852, 86, 1)
	,(8963, 73, 1)
	,(3247, 95, 2)
	,(3247, 58, 1)

SELECT
	AVG(CAST(Grade AS FLOAT)) AS AVG_Grade
FROM
	(
		SELECT
			Student,Grade,Section
			,ROW_NUMBER() OVER(PARTITION BY Student ORDER BY Section DESC) AS RN
		FROM	#ClassAvge
	)A
WHERE
	A.RN = 1

select  a.Student, a.Grade, c.Section
into #ClassAvge
from Tables A,B,C...
where Conditions ...
order by a.Student 


SELECT AVG(CAST(Grade AS FLOAT)) AS AVG_Grade
FROM	(
	SELECT Student,Grade,Section
		,ROW_NUMBER() OVER(PARTITION BY Student ORDER BY Section DESC) AS RN
	FROM	#ClassAvge
	)A
WHERE A.RN = 1

drop table #ClassAvge