OPER1021 Chapter Notes - Chapter 8: Dependent And Independent Variables, Average Absolute Deviation, Mean Squared Error
16 Feb 2017
School
Department
Course
Professor
Document Summary
Accuracy and control for forecasts is a vital aspect of forecasting need to minimize forecast errors. Always some residual error important to include what might be the deviation. Accurate forecasts are necessary for the success of daily activities of every business organization. Some involve a series while others are singular forecasts. Error: difference between the actual value and the value that was predicted for a given period: error = actual forecast. Positive error results when the forecast is too low. Negative errors result when the forecast is too high. Forecast errors influence decisions in two different ways: making a choice between various forecasting alternatives, evaluating the success or failure of a technique in use. Mean absolute deviation (mad): the average absolute forecast error. Mean squared error (mse): the average of squared forecast errors. Mean absolute percent error (mape): the average absolute percent error.
