Actuarial Notes

Exam MAS-II Practice Question 16

Study guide: Exam MAS-II

A claims fraud model is applied to a holdout set of 1,000 claims, of which 80 are fraudulent. At the chosen discrimination threshold the model flags 120 claims for investigation, and 50 of the flagged claims are fraudulent.

Calculate the specificity of the model at this threshold.

  • A) 0.417
  • B) 0.625
  • C) 0.900
  • D) 0.924
  • E) 0.966

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