Harlen Industries has a simple forecasting model: Take the actual demand for the same month last year and divide that by the number of fractional weeks in that month. This gives the average weekly demand for that month. This weekly average is used as the weekly forecast for the same month this year. This technique was used to forecast eight weeks for this year, which are shown below along with the actual demand that occurred.

The following eight weeks show the forecast ( based on last year) and the demand that actually occurred:

a. Compute the MAD of forecast errors.
b. Using the RSFE, compute the tracking signal.
c. Based on your answers to parts (a) and (b), comment on Harlen’s method offore casting.

FORECAST DEMAND ACTUAL DEMAND FORECAST DEMAND ACTUAL DEMAND 180 170 185 205 WEEK WEEK 140 140 140 140 137 133 150 160 140 150 150 150