AI Associate AI Fundamentals Practice Question
A model predicts customer lifetime value with high precision but low recall on high-value customers. What is the business impact?
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
✓
Many false negatives for high-value customers
Low recall means many high-value customers are missed, leading to lost opportunities to retain them.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
- ✓
Many false negatives for high-value customers
Why this is correct
Low recall means the model fails to identify many actual high-value customers.
- ✗
The model is overfitted
Why it's wrong here
Overfitting is not directly indicated by precision/recall trade-off.
- ✗
Many false positives for high-value customers
Why it's wrong here
Low recall indicates many false negatives, not positives.
- ✗
High accuracy on low-value customers
Why it's wrong here
The scenario describes precision and recall for high-value customers, not accuracy.
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