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    forecast errors for sophisticated models

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    What implications do forecast errors have for the search for ultrasophisticated statistical forecasting model?

    All forecasts contain some error whether the model is simple or sophisticated, because forecasts are predictions of the future based on past data. Forecast errors can be caused by changes in conditions that generated the past data, for example. an economic recession could change the demand for certain unnecessary products. The fact that all forecast models have some error, why would we search for more accurate forecast models. No matter what a forecaster does, they can not predict all events in the future that can cause demand to fluctuate.

    © BrainMass Inc. brainmass.com October 10, 2019, 3:09 am ad1c9bdddf
    https://brainmass.com/business/business-math/forecast-errors-sophisticated-models-409226

    Solution Preview

    While it is true that forecasts cannot predict perfectly, due to random and unpredictable events as the posting mentions, that does not mean that forecasts cannot predict ...

    Solution Summary

    Your commentary is 100 words and defends forecasts as useful even though they have errors.

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