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E20-007 · Question #166

Refer to the exhibit. In the exhibit, the x-axis represents the derived probability of a borrower defaulting on a loan. Also in the exhibit, the pink represents borrowers that are known to have not…

The correct answer is A. Logistic Regression. See the full explanation below for the reasoning.

Question

Refer to the exhibit. In the exhibit, the x-axis represents the derived probability of a borrower defaulting on a loan. Also in the exhibit, the pink represents borrowers that are known to have not defaulted on their loan, and the blue represents borrowers that are known to have defaulted on their loan. Which analytical method could produce the probabilities needed to build this exhibit?

Exhibit

E20-007 question #166 exhibit

Options

  • ALogistic Regression
  • BLinear Regression
  • CDiscriminant Analysis
  • DAssociation Rules

How the community answered

(42 responses)
  • A
    71% (30)
  • B
    5% (2)
  • C
    17% (7)
  • D
    7% (3)

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