It is estimated that a customer who leaves costs the firm $2000 in lost profits. Retention program costs are $300. Assuming that everyone predicted to leave can be persuaded to stay, the cost matrix is as depicted below. Predicted Churn = Yes Churn = No Actual Yes No Yes 293 165 Actual If your goal is to minimize the misclassification costs, would you use the full model or the simpler model? Explain why. (Use the test data for scoring and include your calculations to justify the decision). The confusion matrices are reproduced below. Predicted No 266 1386 Churn = Yes Full Model Churn = No 0 Actual $300 $2000 Yes No 0 Yes 220 145 Predicted No 339 1406 Reduced Model

It is estimated that a customer who leaves costs the firm $2000 in lost profits. Retention program costs are $300. Assuming that everyone predicted to leave can be persuaded to stay, the cost matrix is as depicted below. Predicted Churn = Yes Churn = No Actual Yes No Yes 293 165 Actual If your goal is to minimize the misclassification costs, would you use the full model or the simpler model? Explain why. (Use the test data for scoring and include your calculations to justify the decision). The confusion matrices are reproduced below. Predicted No 266 1386 Churn = Yes Full Model Churn = No 0 Actual $300 $2000 Yes No 0 Yes 220 145 Predicted No 339 1406 Reduced Model

Database System Concepts

7th Edition

ISBN:9780078022159

Author:Abraham Silberschatz Professor, Henry F. Korth, S. Sudarshan

Publisher:Abraham Silberschatz Professor, Henry F. Korth, S. Sudarshan

Chapter1: Introduction

Section: Chapter Questions

Problem 1PE

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Suppose, as manager of a chain of stores, you would like to use sales transactional data to analyze the effectiveness of your store's advertisements: In particular, you would like to study how specific factors influence the effectiveness of advertisements that announce a particular category of items on sale. The factors to study are: the region in which customers live, and the day-of-the-week, and time-of-the-day of the ads. Discuss how to design an efficient method to mine the transaction data sets and explain how multidimensional and multilevel mining methods can help you derive a good solution.
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Suppose, as manager of a chain of stores, you would like to use sales transactional data to analyze the effectiveness of your store's advertisements: In particular, you would like to study how specific factors influence the effectiveness of advertisements that announce a particular category of items on sale. The factors to study are: the region in which customers live, and the day-of-the-week, and time-of-the-day of the ads. Discuss how to design an efficient method to mine the transaction data sets and explain how multidimensional and multilevel mining methods can help you derive a good solution.
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