Question 12
If a credit risk model's recall is 0.7 and precision is 0.5, what can be inferred about its performance?
The model identifies 70% of all actual risky customers and 50% of its positive predictions are correct.
The model identifies 50% of all actual risky customers and 70% of its positive predictions are correct.
The model has a high false positive rate and a low false negative rate.
The model has a low false positive rate and a high false negative rate.