Capital One Assessment Test Applied Techniques 2 — Questions and Answers
Question 1: A credit card portfolio has 12,000 accounts. If 3.5% become delinquent and 40% of delinquent accounts are eventually charged off, how many accounts are charged off?
- 168 (Correct answer)
- 420
- 480
- 504
Correct answer: 168
12,000 × 0.035 = 420 delinquent; 420 × 0.40 = 168 charge-offs.
Question 2: A bar chart shows monthly loan originations (in thousands): Jan=45, Feb=38, Mar=52, Apr=49. What is the average monthly origination?
- 45.5
- 46 (Correct answer)
- 46.5
- 47
Correct answer: 46
(45+38+52+49)/4 = 184/4 = 46.
Question 3: A scatter plot shows customer credit scores on the x-axis and default rates on the y-axis. The correlation is −0.78. What does this indicate?
- Higher credit scores are strongly associated with lower default rates (Correct answer)
- Higher credit scores are weakly associated with lower default rates
- Credit score has no predictive value for default
- Higher credit scores are associated with higher default rates
Correct answer: Higher credit scores are strongly associated with lower default rates
A correlation of −0.78 is a strong negative relationship, meaning higher scores predict lower defaults.
Question 4: An analyst must compare two loan products. Product A has an APR of 18.9% and Product B has a monthly rate of 1.65%. Which has the higher annual cost?
- Product A
- Product B (Correct answer)
- They are equal
- Cannot be determined without loan amount
Correct answer: Product B
Product B's annual rate ≈ 1.65% × 12 = 19.8%, which exceeds Product A's 18.9%.
Question 5: A team is prioritizing three risk reduction projects. Project X reduces losses by $500K at a cost of $200K. Project Y reduces losses by $300K at a cost of $80K. Project Z reduces losses by $700K at a cost of $350K. Ranked by ROI (highest first), the order is:
- Y, Z, X
- X, Y, Z
- Z, X, Y
- Y, X, Z (Correct answer)
Correct answer: Y, X, Z
Y ROI=275%, X ROI=150%, Z ROI=100% — order is Y, X, Z.
Question 6: A pivot table shows credit limit utilization by region. The Northeast region shows $4.2M utilized out of $18M total limit. What is its utilization rate?
- 19.4%
- 21.4%
- 23.3% (Correct answer)
- 25.0%
Correct answer: 23.3%
4.2 / 18 = 0.2333… ≈ 23.3%.
Question 7: An analyst notices that card transaction fraud rates spike on weekends but the fraud detection model was trained only on weekday data. This is an example of:
- Overfitting
- Data leakage
- Sampling bias (Correct answer)
- Multicollinearity
Correct answer: Sampling bias
Training on weekday-only data creates a biased sample that fails to represent weekend behavior.
Capital One Assessment Test Applied Techniques 2
A credit card portfolio has 12,000 accounts.
If 3.5% become delinquent and 40% of delinquent accounts are eventually charged off, how many accounts are charged off?