Estimate Default Rates Using Logistic Regression Model
Capital OneData Scientist · Onsite
Last updated
This interview question evaluates statistical assumptions, formulas, estimation strategy, uncertainty, edge cases, and interpretation in a realistic interview setting. A strong answer for Estimate Default Rates Using Logistic Regression Model states assumptions, handles edge cases, explains trade-offs, and shows how to validate the result clearly.
Scenario
On-site Statistical Role Play – estimate credit-card default probability for a new customer segment.
Question
Choose and justify a statistical model to estimate default rates given account age, utilization, and credit score. Calculate a 95% confidence interval for the default rate and explain the meaning of the interval to a non-technical executive.
Hints
Logistic regression, Wald vs. bootstrap intervals, interpret coefficients in odds ratios.
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