Concept:
Mean Absolute Percentage Error (MAPE):
Mean absolute percentage error (MAPE)
\(MAPE= \frac{{\mathop \sum \nolimits_{i = 1}^n \left| {\frac{{D_i - F_i}}{{D_i}}} \right|}}{n} \times 100 = \frac{{\mathop \sum \nolimits_{i = 1}^n \left| {\frac{{E_i}}{{D_i}}} \right|}}{n} \times100 \)
Calculation:
Given:
Period
|
Actual Demand
(Di)
|
Forecasted Demand
(Fi)
|
Absolute Percentage Error
Ei = (Di - Fi)
|
April
|
225
|
200
|
25
|
May
|
220
|
240
|
-20
|
June
|
285
|
300
|
-15
|
July
|
290
|
270
|
20
|
August
|
250
|
230
|
20
|
Mean Absolute Percentage Error (MAPE):
\(MAPE = \frac{{\mathop \sum \nolimits_{i = 1}^n \left| {\frac{{D_i - F_i}}{{D_i}}} \right|}}{n} \times 100 \)
\( \therefore \frac{{\left| {\frac{{ 25}}{{225}}} \right| + \left| {\frac{{ - 20}}{{220}}} \right| + \left| {\frac{{ - 15}}{{285}}} \right| + \left| {\frac{{ 20}}{{290}}} \right| + \left| {\frac{{20}}{{250}}} \right|}}{5} \times 100 =8.072\; \% \)