Two methods are used to predict how many customers will call in for help in the next four days. The first method predicts the numbers of callers to be 23, 5, 14, and 20 for the four respective days. The second method predicts 20, 13, 14, and 20 for the four respective days. The actual numbers of callers turn out to be 23, 10, 15, and 19. Which method has the smaller mean absolute percentage error (MAPE)?
Accepted Solution
A:
Answer:The Second MethodStep-by-step explanation:APE (Absolute Percentage Error) = absolute difference / actual * 100APE for First method = 61.93APE for second method = 54.97MAPE (Mean absolute Percentage error) = Sum of absolute Percentage error/ Number of observations. ( i.e., 4)Then,MAPE for the first method = 61.93 / 4 = 15.482MAPE for the second method = 54.97 / 4 = 13.472So, MAPE for second method is less than the MAPE for first method.