MLS-C01 Question #150: Real Exam Question with Answer & Explanation

Question

A Data Scientist needs to create a model for fraud detection The dataset is composed of 2 years' worth of logged transactions, each with a small set of features All of the transactions in the dataset were manually labeled. Since fraud does not occur frequently, the dataset is highly imbalanced Less than 2% of the dataset was labeled as fraudulent. Which solution provides the optimal predictive power for classifying fraudulent activity?

Options

• AOversample the dataset using a clustering technique, use accuracy as the objective metric, and
• BUndersample the majority class in the dataset using a clustering technique, use precision as the
• CResample the dataset (oversamplinglundersampling), use the F1 score as the objective metric,
• DResample the dataset (oversamplinglundersampling), use accuracy as the objective metric, and