Question

Jill estimated she would spend 50 a month on clothing. However, at the end of the year she discovered she actually spent711 on clothing that year. What was her forecast error for that budget item?

Answer 1

Jill's forecast error for her clothing budget is $111, which is the difference between her actual spending of $711 and her estimated budget of $600 for the year.

Step-by-step explanation:

Jill estimated she would spend $50 a month on clothing. However, at the end of the year, she discovered she actually spent $711 on clothing. To calculate her forecast error for that budget item, we would need to compare her actual expenses with her estimated expenses.

Jill’s estimated expenses for the year would be $50 times 12 months, which equals $600. The forecast error is the difference between the actual expenses and the estimated expenses. Therefore, Jill's forecast error for the clothing budget is $711 (actual) minus $600 (estimated), which equals $111.