The Mean Absolute Deviation Is More Sensitive to Large Deviations

question 1

True/False

The mean absolute deviation is more sensitive to large deviations than the mean square error.

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Definitions:

Loss Contingency

A potential financial loss that might occur in the future due to a past event or condition, whose resolution is uncertain.

Provision for Loss

An amount set aside in the accounting records to cover anticipated losses or liabilities.

U.S. GAAP

United States Generally Accepted Accounting Principles, a set of accounting standards for preparing financial statements that companies in the U.S. are required to follow.

IASB

The International Accounting Standards Board (IASB) is responsible for developing and promoting the use of International Financial Reporting Standards (IFRS).