The errors in a particular forecast are as follows: 4, -3, 2, 5, -1.What is the tracking signal of the forecast?
A)0.4286
B)2.3333
C)5
D)1.4

Question

Quizplus · Accepted Answer

The tracking signal is calculated by dividing the cumulative sum of forecast errors by the mean absolute deviation(MAD).
Cumulative sum of forecast errors = 4-3+2+5-1 = 7
MAD = (|4|+|-3|+|2|+|5|+|-1|)/5 = 3
Tracking signal = 7/3 = 2.3333
Therefore, the correct answer is option B.

The Errors in a Particular Forecast Are as Follows: 4