What is the average squared error used to measure in modeling?

The average squared error is a common metric used in statistical modeling and machine learning to quantify the accuracy of predictions. Specifically, it measures the difference between the prediction estimates and the actual observed values. This difference is squared to ensure that negative and positive errors do not cancel each other out, emphasizing larger errors more heavily. By averaging these squared differences over all observations, the average squared error provides a clear and definitive measure of how well the model's predictions match the actual outcomes in the data.

In the context of model evaluation, having a lower average squared error indicates a better model fit, as it suggests that the predictions are closer to the true values. This metric helps to assess the reliability and performance of a model by providing insight into the magnitude of prediction errors, which is crucial for making informed decisions based on the model's outputs. The other options address different aspects of modeling but do not directly pertain to the measurement of prediction accuracy as indicated by the average squared error.