Interview Question
Senior Data Analyst Interview
-
Capital Onecase study: credit card insurance profit per customer cost of mailing $0.5, response rate 1%, average balance per month $1000, insurance charges 1% of average balance monthly, customer claim rate 5% (once insured customer files a claim, the balance will be wiped and C1 lose $1000). Question: profit per customer, graph claim rate vs response rate, graph profit vs response rate and find the response rate for maximum profit (r=1%)
AnswerAdd Tags
Interview Answers
3 Answers
▲
4
▼
btw, there is no enough info to determine response rate vs claim rate here. they appears independently in the question. I guess you have to clearly ask for info here.
Anonymous on
▲
11
▼
this case is so common that I've seen it more than 4 times on Glassdoor. Aspirant you are wrong because premiums are paid monthly, while loss is assumed yearly. This has already been a "must case" for analysts interviews. If you are tested on this at year of 2013, 2014 and have no idea how to solve it, shame on you.
Anonymous on
▲
50
▼
Can you write the profit equation for credit insurance case. Shouldn't it be P = Rev - Cost = x*(1/100)*1000 - x*(y/100)*1000 - 100*0.5 Where x- response rate, y - claims rate (assumption 100 mails sent) How are u getting the response rate for max profit as 1%. Isn't profit always negative here.
Aspirant on
Add Answers or Comments
To comment on this, Sign In or Sign Up.