When setting a cutoff for a predictor a company wants to maximize the number of

Question

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Maximizing the number of true positives is important for a company because it means correctly identifying individuals who are likely to engage in a behavior or exhibit a characteristic of interest. False positives (selecting individuals who do not actually exhibit the behavior/characteristic) can be expensive and inefficient for a company. False negatives can also be problematic, as this means missing individuals who do exhibit the behavior/characteristic of interest. However, in many cases, false negatives may be more acceptable than false positives (for example, in medical testing scenarios where a false positive could lead to unnecessary and potentially harmful treatments).

When Setting a Cutoff for a Predictor a Company Wants