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ISM INTE Exam - Topic 5 Question 15 Discussion

Actual exam question for ISM's INTE exam
Question #: 15
Topic #: 5
[All INTE Questions]

Consider the following data comparing actual demand versus forecast demand:

Month Actual Demand Forecast Demand

January 100,000 80,000

February 105,000 90,000

March 110,000 100,000

April 70,000 100,000

May 90,000 110,000

June 100,000 90,000

What is the Mean Annual Percent Error (MAPE) for the six months of data?

Show Suggested Answer Hide Answer
Suggested Answer: C

To calculate the Mean Absolute Percentage Error (MAPE), we follow these steps:

1. Find the absolute error for each month.

2. Convert the absolute error to a percentage of the actual demand for each month.

3. Find the average of these percentage errors over the six-month period.

Here's the calculation:

* January: 100,00080,000100,000100=20%left| frac{100,000 - 80,000}{100,000} right| times 100 = 20%100,000100,00080,000100=20%

* February: 105,00090,000105,000100=14.29%left| frac{105,000 - 90,000}{105,000} right| times 100 = 14.29%105,000105,00090,000100=14.29%

* March: 110,000100,000110,000100=9.09%left| frac{110,000 - 100,000}{110,000} right| times 100 = 9.09%110,000110,000100,000100=9.09%

* April: 70,000100,00070,000100=42.86%left| frac{70,000 - 100,000}{70,000} right| times 100 = 42.86%70,00070,000100,000100=42.86%

* May: 90,000110,00090,000100=22.22%left| frac{90,000 - 110,000}{90,000} right| times 100 = 22.22%90,00090,000110,000100=22.22%

* June: 100,00090,000100,000100=10%left| frac{100,000 - 90,000}{100,000} right| times 100 = 10%100,000100,00090,000100=10%

MAPE=(20+14.29+9.09+42.86+22.22+10)6=19.41%20%MAPE = frac{(20 + 14.29 + 9.09 + 42.86 + 22.22 + 10)}{6} = 19.41% approx 20%MAPE=6(20+14.29+9.09+42.86+22.22+10)=19.41%20%

Thus, the MAPE for the six months of data is approximately 20%. Reference:

* Chase, R. B., Jacobs, F. R., & Aquilano, N. J. (2006). Operations Management for Compet-itive Advantage. McGraw-Hill/Irwin.

* Hyndman, R. J., & Athanasopoulos, G. (2018). Forecasting: principles and practice. OTexts.


by Leontine at Sep 15, 2024, 09:18 PM

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Jade
3 months ago
Looks like April really dragged down the average!
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Dalene
3 months ago
Wait, how can the forecast be so off?
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Mozell
4 months ago
Disagree, I feel like it should be closer to 20%.
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Yesenia
4 months ago
I think the MAPE is around 15%.
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Daisy
4 months ago
Actual demand was higher than forecast in most months.
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Lourdes
4 months ago
I feel like I might have miscalculated in the practice questions; I hope I remember the right method for this one!
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Cecily
4 months ago
I think the MAPE is usually around 10-15% for good forecasts, but I’m not confident about the actual calculation here.
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Dierdre
5 months ago
This question seems similar to one we did in class, but I can't recall the exact steps for calculating MAPE.
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Sharen
5 months ago
I remember we practiced calculating MAPE, but I’m not sure if I got the formula right.
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Fletcher
5 months ago
Wait, what's the MAPE again? I'm a little confused on the concept. Maybe I should review the lecture notes before attempting this.
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Kristian
5 months ago
I've got this! The MAPE formula is the average of the absolute value of the percent errors for each month. Time to crunch the numbers.
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Shanda
5 months ago
Hmm, this looks tricky. I'm not sure how to calculate the MAPE, but I'll give it my best shot.
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Mendy
5 months ago
Okay, let's think this through step-by-step. I'll need to calculate the percent error for each month and then take the average.
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Joanne
5 months ago
I'm leaning towards option D, but wasn't there something about needing to account for write-back functionality? I'm kind of confused on that part.
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Cory
1 year ago
I bet the person who wrote this question has a wicked sense of humor. This is like a math riddle!
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Verlene
1 year ago
All this data has my head spinning. I need a break and a cup of coffee before I attempt this.
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Dallas
1 year ago
I think we definitely need a coffee break before diving into this MAPE calculation.
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Deeanna
1 year ago
I agree, this data is making my head spin.
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Carmen
1 year ago
Let's take a break and grab a cup of coffee before tackling this data.
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Thaddeus
1 year ago
I'm just going to blindly guess 'C' and hope for the best. Math was never my strong suit.
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Nickolas
1 year ago
User2: I'm going with A) 10%
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Amie
1 year ago
User3: I'll go with C) 20%
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Galen
1 year ago
I think the answer is B) 15%
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Vernell
1 year ago
Wait, is that a trick question? I feel like the answer should be lower than the options provided.
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Jeniffer
1 year ago
20% MAPE? That's a bit too high for my liking. I'm thinking it's gotta be around 15%.
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Billye
1 year ago
Let's go with 15% then.
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Veronika
1 year ago
I'm leaning towards 15% as well.
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Dolores
1 year ago
Yeah, 20% seems too high for these numbers.
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Valentin
1 year ago
I think it's around 15% too.
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Skye
1 year ago
Yeah, 20% does seem high. 15% sounds more accurate based on the data provided.
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Tracey
1 year ago
I think 15% is a reasonable estimate for the Mean Annual Percent Error.
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Brett
1 year ago
I agree, 20% seems a bit high. I would also go with 15%.
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Werner
1 year ago
Based on that calculation, the MAPE would be 15%, which corresponds to option B. So, I would go with option B as the answer.
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Matthew
1 year ago
I agree with Tony. So, the MAPE would be (|100,000-80,000|/100,000 + |105,000-90,000|/105,000 + |110,000-100,000|/110,000 + |70,000-100,000|/70,000 + |90,000-110,000|/90,000 + |100,000-90,000|/100,000) / 6.
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Tony
1 year ago
I think the MAPE is calculated by taking the absolute difference between actual and forecast demand, dividing by actual demand, and then averaging over all months.
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Eladia
1 year ago
Hmm, this looks tricky. Time to break out the calculator and crunch some numbers!
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Candra
1 year ago
B) 15%
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Genevieve
1 year ago
A) 10%
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