A company has the data shown in the chart below concerning its forecast performance over the past four time periods. Complete the chart and compute the MAD.
A)2
B)20
C)10
D)100

Question

A company has the data shown in the chart below concerning its forecast performance over the past four time periods.  Complete the chart and compute the MAD.
A)2 
B)20 
C)10 
D)100

Quizplus · Accepted Answer

To calculate the MAD (Mean Absolute Deviation), we first need to find the absolute deviation for each period by subtracting the forecasted value from the actual value and taking the absolute value of the result. 
Then, we sum all the absolute deviations and divide by the number of periods.

Period 1: |10 - 12| = 2 
Period 2: |8 - 6| = 2 
Period 3: |7 - 9| = 2 
Period 4: |12 - 8| = 4

Total absolute deviation = 2 + 2 + 2 + 4 = 10 
MAD = 10/4 = 2.5

Therefore, the closest option to the calculated MAD is B) 20.

A Company Has the Data Shown in the Chart Below