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1Z0-1127-25 Fundamentals of Large Language Models Practice Question

You are a machine learning engineer at a large e-commerce company. You have been tasked with deploying a large language model to power a customer service chatbot that handles product returns and refunds. The model will answer customer queries based on a knowledge base of return policies and FAQs. The company has strict requirements: (1) responses must be factually accurate and grounded in the knowledge base, (2) the system must be cost-effective, and (3) latency should be under 2 seconds per response. You decide to use a pre-trained LLM from OCI Data Science and implement retrieval-augmented generation (RAG). You have two options for the retriever: a dense embedding-based retriever (e.g., using OCI AI Language embeddings) or a sparse keyword-based retriever (e.g., BM25). You also need to decide on the generation model size: a 7B parameter model or a 70B parameter model. You run a pilot test: with the dense retriever + 7B model, average latency is 1.8 seconds and accuracy is 85%. With the sparse retriever + 7B model, latency is 1.2 seconds but accuracy drops to 75%. With the 70B model (any retriever), latency exceeds 5 seconds. Which combination should you choose to meet all requirements?

⚠ Common exam trap

Oracle often tests the trade-off between retrieval accuracy and model size, where candidates mistakenly prioritize a larger model (70B) for better generation quality, ignoring that the latency constraint makes it infeasible, or choose a sparse retriever thinking it's faster, but overlook the critical accuracy requirement for grounded responses.

Answer choices

Why each option matters

Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.

Correct answer & explanation

Dense retriever + 7B model.

(dense retriever + 7B model) is correct because it meets all three requirements: factual accuracy (85% accuracy from dense retrieval grounding), latency under 2 seconds (1.8 seconds), and cost-effectiveness (7B model is cheaper to run than 70B). The dense retriever provides better semantic matching for nuanced return policy queries, while the 7B model keeps inference fast and affordable.

Answer analysis

Option-by-option breakdown

For each option: why learners choose it and why it is or isn't the right answer here.

  • Sparse retriever + 70B model.

    Why it's wrong here

    Latency >5 seconds exceeds requirement.

  • Dense retriever + 70B model.

    Why it's wrong here

    Latency >5 seconds exceeds requirement.

  • Sparse retriever + 7B model.

    Why it's wrong here

    Accuracy 75% likely insufficient for factual accuracy.

  • Dense retriever + 7B model.

    Why this is correct

    Meets both latency and accuracy requirements.

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