Forecasting Model Error Estimation and Hypothesis Testing

5 Forecasting Model Error Estimation and Hypothesis Testing 

According to the size deviation between forecast trends in values and actual values, the parameter is tested, which is obtained by prediction model for prediction. These 

The predicted value and actual value difference calculating 

We can use the actual values and forecast values of relative error to analyze the difference and decide whether it is acceptable or not. 

Among the above three equations, e, is the difference between actual values and forecast values, Y as the predicted value, Y as the actual value, e as average relative error, as variance of e, S as standard error. 

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