A Bank Has Categorized Its Credit Card Accounts as High

question 19

Multiple Choice

A bank has categorized its credit card accounts as high risk or low risk. The overall default rate on all the bank's credit card accounts is .20. In the past, of the accounts that defaulted, 50 percent were correctly identified by the bank as high risk. What is the default risk for a high-risk credit card account?

• A) .50.
• B) .15.
• C).40.
• D).25.
• E) There is not enough information to determine the answer.

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Definitions:

Trust

The reliance on the integrity, strength, ability, surety, or certainty of a person or thing; foundational to building effective relationships.

Work

The effort or activity directed toward the production or accomplishment of something.

Effective Mentors

Experienced individuals who provide guidance, knowledge, and support to less experienced persons, enhancing their personal and professional growth.

Characteristics

Distinctive traits or features that define an individual, group, or thing.