Given forecast errors of 5, 0, -4, and 3, what is the bias?
A) -4
B) 4
C) 5
D) 12
E) 6

Name: Given forecast errors of 5, 0, -4, and 3, what is the bias? A) -4 B) 4 C) 5 D) 12 E) 6
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Question

Quizplus · Accepted Answer

Bias is calculated by taking the average of forecast errors. The sum of forecast errors is 5 + 0 + (-4) + 3 = 4. The average is then 4/4 = 1. Since the bias is positive, the forecast tends to be too low. So, the correct answer is B, which is 4.

Given Forecast Errors of 5, 0, -4, and 3, What