Asked by Frank Lafferty on Jun 28, 2024
Verified
The primary purpose of the mean absolute deviation (MAD) in forecasting is to
A) estimate the trend line.
B) eliminate forecast errors.
C) measure forecast accuracy.
D) seasonally adjust the forecast.
E) all of the above.
Mean Absolute Deviation
A measure of the average absolute differences between each number in a set of values and the mean of the values.
Forecast Accuracy
The degree to which predicted outcomes align with actual results, often used in planning and decision-making processes.
- Calculate and interpret the mean absolute deviation (MAD) to measure forecast accuracy.
Verified Answer
PD
Pardeep DhaliwalJul 01, 2024
Final Answer :
C
Explanation :
The MAD is used to measure the forecast accuracy by calculating the average absolute difference between actual and forecast values.
Learning Objectives
- Calculate and interpret the mean absolute deviation (MAD) to measure forecast accuracy.