What is the difference between projection and prediction?

Answer 1

A great amount of confusion seem to have grown up in the use of words 'forecast', 'prediction' and

'projection'. A prediction is an estimate based solely in past data of the series under investigation. It

is purely mechanical extrapolation. A projection is a prediction where the extrapolated values are

subjects to a certain numerical assumptions. A forecast is an estimate which relates the series in

which we are interested to external factors. Forecasts are made by estimating future values of the

external factors by means of prediction, projection or forecast and from these values calculating the

estimate of the dependent variable.