The Other Residuals

Summary

This chapter presents a brief introduction to the use of residuals computed in a different way.

The discussion is however limited to the use of multiplicative residuals, because their use, in conjunction with the multiplicative formula, offers some potential interest to the cost analyst.

The reader is reminded on the fact that, whatever, the type of residuals used, comparison between formulae can only be done if the residuals are expressed the same way.

The previous chapter investigated the residuals defined as additive.

Let us remind the reader that the way residuals are defined has nothing to do with the choice of the metric, even if, most often, cost analysts select the additive residuals with the additive formula, the multiplicative residuals with the multiplicative or the exponential formulae, etc.

This chapter investigates other residuals, but limit the discussion to the multiplicative ones, because they present an interesting properties in the cost domain when they are used with the multiplicative formula.