A tracking signal is computed by
A)multiplying the cumulative error by MAD.
B)multiplying the absolute error by MAD.
C)dividing MAD by the cumulative absolute error.
D)dividing the cumulative error by MAD.

Question

Quizplus · Accepted Answer

A tracking signal is computed by dividing the cumulative error by MAD (Mean Absolute Deviation). It is used to monitor the forecast errors over time and determine if the forecast needs to be adjusted. A tracking signal greater than three suggests an unacceptable level of bias in the forecasts.

A Tracking Signal Is Computed by