MAPE Meaning and
Definition
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MAPE stands for Mean Average Percentage Error. It is a statistical measure commonly used in forecasting and statistics to evaluate the accuracy of a forecast or prediction.
MAPE is calculated by taking the absolute percentage difference between the actual and forecasted values for a given data set, averaging these differences, and then expressing the result as a percentage. The absolute percentage difference is obtained by dividing the difference between the actual and forecasted values by the actual value, and then multiplying by 100. This process is carried out for each data point in the set, and the average of the absolute percentage differences is calculated to derive the MAPE.
The MAPE provides a relative measure of forecast accuracy, allowing comparisons between different datasets or forecasting methods. A MAPE of 0% indicates a perfect forecast, where the actual and predicted values are identical. Higher MAPE values indicate less accurate forecasts, with larger differences between the forecasted and actual values.
While MAPE is a widely used measure, it does have limitations. For instance, it gives equal weight to all data points, regardless of their magnitude, which may not always be appropriate. Additionally, MAPE can produce infinite values or become undefined when the actual value is zero. Overall, the MAPE offers a straightforward and intuitive way to assess forecast accuracy and is often utilized in various fields, including business, economics, and operations research.
Common Misspellings for MAPE
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