Solution-Compute the mad of forecast errors

Compute the mad of forecast errors

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Reference no: EM133070430

Question - Harlen Industries has a simple forecasting model: Take the actual demand for the same month last year and divide that by the number of fractional weeks in that month. This gives the average weekly demand for that month. This weekly average is used as the weekly forecast for the same month this year. This technique was used to forecast eight weeks for this year, which are shown below along with the actual demand that occurred.

The following eight weeks show the forecast (based on last year) and the demand that actually occurred:

WEEK	FORECAST DEMAND	ACTUAL DEMAND
1	140	137
2	140	133
3	140	150
4	140	160
5	140	180
6	150	170
7	150	185
8	150	205

Required -

a. Compute the MAD of forecast errors.

b. Using the RSFE, compute the tracking signal.

c. Based on your answers to a and b, comment on Harlen's method of forecasting.

Reference no: EM133070430

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Compute the mad of forecast errors

Reference no: EM133070430

Reference no: EM133070430

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