Which of the following is true regarding the MSE and MAD in forecasting?
A) The MAD will tend to be a larger value than the MSE.
B) The MSE is much more useful than the MAD.
C) The square root of the MSE provides a value that will be similar to the MAD.
D) The MAD will be equal to the MSE.

Question

Quizplus · Accepted Answer

The Mean Squared Error (MSE) is the average of the squares of the errors, while the Mean Absolute Deviation (MAD) is the average of the absolute values of the errors. Taking the square root of the MSE (which gives the Root Mean Squared Error, RMSE) makes it more directly comparable to the MAD, as both then represent average error magnitudes in the same units as the original data.

Which of the Following Is True Regarding the MSE and MAD