Question

Explain what the MAPE tells a forecaster.

Answer 1

The MAPE estimates the size of the error in rate terms. Numerous associations center basically around the MAPE when evaluating forecast precision. The vast majority are open to intuition in rate terms, making the MAPE simple to decipher. It can likewise pass on data when you don't have the foggiest idea about the thing's demand volume. For instance, telling your manager, we were off by under 4% is more important than saying we were off by 3,000 cases if your manager doesn't have the foggiest idea about a thing's commonplace demand volume.

The MAPE is scaled delicate and ought not to be utilized when working with low-volume information. Notice that because "Real" is in the denominator of the condition, the MAPE is unclear when Actual demand is zero. Besides, when the Actual worth isn't zero, yet very little, the MAPE will frequently take on extraordinary qualities. This scale affectability renders the MAPE near useless as an error measure for low-volume information.