- CFA Exams
- CFA Level I Exam
- Topic 1. Quantitative Methods
- Learning Module 6. Machine Learning
- Subject 2. Overview of Evaluating ML Algorithm Performance
CFA Practice Question
In machine learning, the trade-off between overfitting and generalization is effectively the trade-off between:
B. cost and complexity
C. complexity and sample sizes
A. cost and benefit
B. cost and complexity
C. complexity and sample sizes
Correct Answer: B
As the flexibility (order in complexity) increases, its variance increases, and its bias decreases. So choosing the flexibility based on average test error amounts to a bias-variance trade-off.
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