Exam MAS-II Practice Question 18
Study guide: Exam MAS-II
Two pure premium models are compared with simple quintile plots on a holdout data set. Within each quintile, pure premiums are divided by the overall average. The first and last quintiles are:
| Model A predicted | Model A actual | Model B predicted | Model B actual | |
|---|---|---|---|---|
| Quintile 1 | 0.60 | 0.70 | 0.58 | 0.55 |
| Quintile 5 | 1.55 | 1.40 | 1.45 | 1.50 |
Lift is measured as the ratio of the actual pure premium in the last quintile to that in the first.
Determine which model shows more lift, and the amount of that model's lift.
- A) Model A, with lift 2.58
- B) Model A, with lift 2.00
- C) Model B, with lift 2.50
- D) Model B, with lift 2.73
- E) Model B, with lift 1.50
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