ABSTRACT:
Forecasting is of fundamental importance in all of the sciences, including economics. As such, its accuracy is of obvious importance as the forecasts generated are normally being used as inputs to a decision-making process. Knowing this fact, most forecasters have been hard pressed to prepare the most realistic and accurate projections utilizing a variety of quantitative and subjective methodologies. Besides this concern and although it is extremely important to do their best to improve forecast accuracy, we must learn to accept the fact that forecast error is an unavoidable occurrence. Faced with this reality, the forecasters need to effectively capture, measure, report and utilize forecast error to its benefit. They will also keep on reviewing their models from which the forecasts are based on due to the ever changing environment and improving forecast accuracy through a variety of qualitative and quantitative techniques.
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