Conditional probability · Fraud detection
The flagged transaction
Of the card payments a bank's model reviews, 5% are fraud. The model flags 95% of fraudulent payments, but it also flags 10% of genuine ones. A payment gets flagged. What is the probability that it really is fraud?
Answer with a probability. First lock in a gut guess with an 80% range, then solve it properly, then watch a simulation settle on the truth.
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