ROC Curves Are Often Used to Evaluate Model Fit for a Logistic

question 14

Essay

ROC curves are often used to evaluate model fit for a logistic regression. Why is this appropriate?

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Definitions:

Absorption Costing

An accounting method that includes all manufacturing costs—direct materials, direct labor, and both variable and fixed manufacturing overhead—in the cost of a product.

Variable Costing

A cost system that excludes fixed costs from product costs and writes off all fixed costs against income in the year that the costs are incurred. Also called direct costing.

Step-fixed Costs

Expenses that remain constant for a set level of production or output, but can change when a certain threshold is crossed.

Inflationary Price Increase

The rise in prices of goods and services over time, typically due to an increase in the money supply or demand outpacing supply.