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. A bank wants to use historic loan repayment records to categorize loan applications as low-risk or high-risk based on characteristics like the loan amount, the income of the borrower, and the loan period. What kind of machine learning model should the bank use automated machine learning to create? ClassificationRegressionTime series forecasting

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. A bank wants to use historic loan repayment records to categorize loan applications as low-risk or high-risk based on characteristics like the loan amount, the income of the borrower, and the loan period. What kind of machine learning model should the bank use automated machine learning to create? ClassificationRegressionTime series forecasting

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Solution

The bank should use a machine learning model that is suitable for categorizing loan applications as low-risk or high-risk based on the given characteristics. One possible approach is to use a classification model. Classification models are designed to assign input data to specific categories or classes. In this case, the model can be trained using the historic loan repayment records, with the loan amount, borrower's income, and loan period as the input features. The model can then predict whether a new loan application is low-risk or high-risk based on these features.

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