Exercise

# To tree or not to tree?

Imagine you have 2 banks: Bank A, and Bank B. These banks are restricted to using a certain acceptance rate.

- Bank A has to use an acceptance rate of 45%
- Bank B has to use an acceptance rate of 85%

Based on the strategy tables, which model will Bank A and Bank B prefer to use?

Do not hesitate to have a look at the tables again. They are loaded in your workspace as `strategy_cloglog$table`

and `strategy_loss_matrix$table`

.

Instructions

**50 XP**

##### Possible Answers

- Bank A and Bank B will both prefer to use the logistic regression model (represented by
`strategy_cloglog`

) - Bank A and Bank B will both prefer to use the classification tree model (represented by
`strategy_loss_matrix`

) - Bank A will prefer to use the logistic regression model, but for Bank B, the classification tree model leads to a lower bad rate.
- Bank A will prefer to use the classification tree model, but for Bank B, the logistic regression model leads to lower bad rates.