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Forums › FIA Forums › MA2 Managing Costs and Finance Forums › MA2 Managing Costs and Finance Forums › Multiplicative Model MA2 BPP book
Hi,
I´m analyzing an example where the average q1=0.975, q2=1.3035,q3=0.637 and q4= 1.0935 the total is 4.009/4=1.00225 but they use 0.00225 average to be deducted.
Note: Instead of summing to zero, as with addictive approach, the averages should sum(in this case) 4.0,1.0 for each of the four quarters.
Could someone help to understand why they´re using a different number?
Thanks is advance.
The avreage should not be 4. That’s the total. The average should be 1.
The sum of all quarters is 4.009 which will be divided by 4 to get the average which is 1.00225.
So my question is if the average is 1.00225 why they are using only 0.00225?
Note: Instead of summing to zero, as with addictive approach, the averages should sum(in this case) 4.0,1.0 for each of the four quarters. This is confusing me.
Thanks in advance