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Financial Forensics · End Term · 21 Dec 2025 · September 2025 term

Question 19: In a credit risk scenario, if a model has high recall bu…

Question 19

+1 markOne correct option

In a credit risk scenario, if a model has high recall but low precision, it implies that:

  1. A

    The model correctly identifies a high percentage of non-risky customers but makes many mistakes in identifying risky customers.

  2. B

    The model correctly identifies a high percentage of risky customers but also incorrectly labels many non-risky customers as risky.

  3. C

    The model correctly identifies a high percentage of non-risky customers and makes few mistakes in identifying risky customers.

  4. D

    The model correctly identifies a high percentage of risky customers and makes few mistakes in identifying non-risky customers.

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Correct answer

  • B

    The model correctly identifies a high percentage of risky customers but also incorrectly labels many non-risky customers as risky.

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Question 19 of 40 in the IIT Madras BS Financial Forensics (Financial Forensics) End Term paper sat on 21 Dec 2025, in the September 2025 term (Financial Forensics 18 Dec 25). It carries 1 mark.

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