Problem related to forecasting methods


Suppose two forecasting methods - call them FM1 and FM2 - are being compared. FM1's MAD and MAPE are smaller than FM2's. FM2's MSE is smaller than FM1's. If FM2 is determined to be the better choice, this must mean that in this situation:

Answers: A. Avoiding the occasional large error is important

B. Major changes in the fundamental demand pattern are expected in the future

C. Demand is expected to become less variable in the future

D. Fundamental changes in seasonal patterns have occurred

E. None of the above

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Operation Management: Problem related to forecasting methods
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