AI0-001 Practice Test 1 — 10 Questions

Question 1

A machine learning engineer is building a spam filter. The dataset contains 10,000 emails, of which 1,000 are spam. The engineer decides to use a Random Forest classifier. Which preprocessing step is most critical to ensure the model generalizes well to new, unseen emails?

Accepted Answer

Split the data into training and testing sets before any other preprocessing. Option C is correct because splitting the data into training and testing sets before any other preprocessing prevents data leakage. If preprocessing like normalization or PCA is applied to the entire dataset first, the test set information influences the training process, leading to overly optimistic performance estimates and poor generalization to new, unseen emails.

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Apply Principal Component Analysis (PCA) to reduce dimensionality

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Normalize the numerical features to have zero mean and unit variance

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Encode all features using one-hot encoding

Question 2

Which THREE are common data preprocessing steps in a machine learning pipeline? (Choose 3)

Accepted Answer

Encoding categorical variables. Encoding categorical variables is a common data preprocessing step because machine learning algorithms require numerical input. Techniques like one-hot encoding or label encoding convert categorical data (e.g., colors, countries) into numeric format, enabling the model to process them correctly. Without this step, the model would misinterpret categorical labels as ordinal or meaningless numeric values.

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Hyperparameter tuning

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Model evaluation

Question 3

An e-commerce company uses an AI system to set dynamic prices for products. A customer complains that the price they see is higher than the price shown to a friend for the same product at the same time. The company wants to ensure pricing fairness. Which ethical principle should guide the redesign of the pricing algorithm?

Accepted Answer

Transparency and explainability. Transparency and explainability is the correct principle because the core issue is that the customer cannot understand why the AI system set a different price for them compared to their friend. Redesigning the algorithm to provide clear, understandable reasons for price variations—such as demand, purchase history, or time of day—directly addresses this lack of visibility. This principle ensures that the system's decision-making process is open to scrutiny, which is essential for building trust and resolving fairness complaints in dynamic pricing models.

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Privacy by design

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Accountability

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Beneficence

Question 4

An AI system used for autonomous driving is found to have a lower accuracy in detecting pedestrians with darker skin tones. The development team wants to address this ethical issue. Which action is most effective?

Accepted Answer

Augment the training dataset with more images of pedestrians with darker skin. Option B is correct because augmenting the training dataset with more images of pedestrians with darker skin directly addresses the root cause of the bias: underrepresentation in the training data. By providing a more balanced and diverse dataset, the model can learn more robust features for all skin tones, reducing accuracy disparity without altering the algorithm's core logic or introducing arbitrary thresholds.

Answer

Conduct additional testing to measure the disparity

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Replace the object detection algorithm with a different one

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Adjust the model's decision threshold for pedestrian detection

Question 5

In the AI lifecycle, which phase involves splitting data into training, validation, and test sets?

Accepted Answer

Data preprocessing. Data preprocessing is the phase where raw data is cleaned, transformed, and prepared for modeling. Splitting the dataset into training, validation, and test sets is a critical step during this phase to ensure unbiased evaluation and prevent data leakage. This split occurs before any model training begins, making it part of preprocessing rather than training or evaluation.

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Model training

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Data collection

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Model evaluation

Question 6

A startup is building a chatbot for customer service. They have 500 recorded conversations and want to use a pre-trained language model to generate responses. However, they have limited computational resources and need the chatbot to respond in real-time. They are considering fine-tuning a large model like GPT-3 or using a smaller model like DistilBERT. The conversation data contains industry-specific jargon. Which approach should they take?

Accepted Answer

Fine-tune DistilBERT on the conversation data. Option B is correct because fine-tuning DistilBERT on the 500 recorded conversations allows the model to adapt to industry-specific jargon while maintaining real-time responsiveness due to its smaller size. DistilBERT is a distilled version of BERT that retains 97% of BERT’s language understanding with 40% fewer parameters, making it suitable for limited computational resources. Fine-tuning on domain-specific data is essential here, as pre-trained models like GPT-3 lack exposure to the startup’s specialized terminology, and using a smaller model ensures low-latency inference for real-time chatbot responses.

Answer

Use GPT-3 via API without fine-tuning

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Train a custom RNN from scratch on the conversations

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Implement a rule-based system with keywords

Question 7

A data scientist is preparing a dataset for supervised learning. Which TWO steps are essential?

Accepted Answer

Labeling the data. Labeling the data is essential for supervised learning because the algorithm requires input-output pairs to learn a mapping function. Without labeled data, the model cannot be trained to predict outcomes, as supervised learning relies on ground-truth targets for error correction during training.

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One-hot encoding all features

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Normalizing features

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Removing outliers

Question 8

A company wants to create an AI system that can identify objects in images. They have a large dataset of labeled images. Which type of neural network architecture is most suitable?

Accepted Answer

Convolutional neural network (CNN). Convolutional neural networks (CNNs) are specifically designed to process grid-like data such as images. They use convolutional layers to automatically learn spatial hierarchies of features (edges, textures, objects) from pixel data, making them the most suitable architecture for image classification tasks with labeled datasets.

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Transformer

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Generative adversarial network (GAN)

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Recurrent neural network (RNN)

Question 9

A financial services company is developing an AI model to detect fraudulent transactions. The dataset contains 99.9% legitimate transactions and 0.1% fraudulent ones. Which technique should the data scientist use to address the class imbalance problem?

Accepted Answer

Apply Synthetic Minority Oversampling Technique (SMOTE). SMOTE (Synthetic Minority Oversampling Technique) is the correct choice because it generates synthetic examples of the minority class (fraudulent transactions) by interpolating between existing minority instances, rather than duplicating them. This addresses the extreme 0.1% fraud rate without introducing overfitting or losing data, making it a standard technique for imbalanced classification problems in financial fraud detection.

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Use a bagging ensemble method

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Undersample the legitimate transactions

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Use cost-sensitive learning with higher weight on fraudulent class

Question 10

Based on the exhibit, which action is most likely to resolve the memory issue?

Accepted Answer

Reduce the batch size.. The exhibit shows an out-of-memory (OOM) error during training. Reducing the batch size decreases the memory footprint per iteration, allowing the model to fit within available GPU memory. This directly resolves the memory issue without altering the model architecture or data.

Answer

Add more training data.

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Increase the learning rate.

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Switch to a CPU.