In this problem, you are to test the validity of your forecasting model. Hare ar

Question

In this problem, you are to test the validity of your forecasting model. Hare are the forecasts for a model you have been using and the actual demands that occurred: Use the method stated in the text to compute the MAD and tracking signal for each week. (Negative values should be indicated by a minus sign. Round your "Tracking Signal" to 1 decimal place and all other answers to the nearest whole number.) Deside whether the forecasting model you have been using is giving reasonable results. The forecasting model is unacceptable The forecasting model is acceptable

Explanation / Answer

Week Forecast Actual Deviation Running sum of forecast errors Absolute Deviation Sum of Absolute Deviation Mean Absolute Deviation Tracking Signal 1 890 910 20 20 20 2 780 930 150 170 150 3 880 980 100 270 100 4 880 830 -50 220 50 5 930 830 -100 120 100 6 905 1110 205 325 205 625 104.167 3.12 MAD = |at ft| / n Tracking signal = (at ft) / MAD

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