A Credit Card Company Wants to Spot Elusive Patterns in Credit

question 72

Multiple Choice

A credit card company wants to spot elusive patterns in credit card transaction records to be able to block fraudulent transactions. This company should use ________.

• A)data mining
• B)data modeling
• C)data drudging
• D)data transformation

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Definitions:

Underlying Asset

An asset or security on which a derivative instrument, such as a futures or options contract, is based.

Value Decrease

Occurs when the value of an asset or investment declines over time due to market conditions, wear and tear, or other factors.

Black-Scholes

A mathematical model used for pricing European-style options, taking into account factors like volatility, underlying asset price, strike price, and time to expiration.

American Style Puts

Options that give the holder the right to sell a specific stock at a specified price before the option expires.