Part 2. MM4XL Tools > 2. Analytical Tools > Business Formulas > 3. Forecast Errors > mmME, Mean Error

Business Formulas

mmME, Mean Error

Category: Forecast

A common way of checking for the bias in forecasting is to keep a check on the errors by recording the over-forecasts (+) and under-forecasts (-). If there is a consistent number of over-forecasts (+) or under-forecasts (-), bias exists. Stated simply, if we find this consistency, then the Mean Error (ME) is not equal to zero and bias exists.

Business analysis formulas for Excel. Marketing tool for professionals

Syntax

mmME(Actual_Data, Optional Forecast_Data)

Actual_Data Either Sales Values, then the next variable is required, or Error values
Forecast_Data Optional - Forecast Data, required if the previous variable is equal to Sales Values

Example

See example file Business Formulas.xls, sheet mmME.

Business analysis formulas for Excel. Marketing tool for professionals

Related functions
  • mmDW
  • mmMAD
  • mmMAPE
  • mmMSE
  • mmRMSE
  • mmSEASON
  • mmU
  • mmBASS
  • mmRANGE
  • mmRANK
  • mmVARc
Related MM4XL software tools
  • Forecast Manager
  • Brand Switch Analyst
  • Profile Manager
Source
Jeffrey Jarrett, 1987, Business forecasting methods
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