Describe the Business Drivers for Big Data Analytics and Data Science DATA-SCIENCE-FOUNDATIONS Practice Questions (Page 1)

Questions 1–5

1. 1application · medium

   An insurance company wants to innovate by offering usage-based auto insurance. They plan to collect telematics data from policyholders' vehicles to price premiums based on actual driving behavior. What is the most significant strategic impact of this initiative?

   • AIt enables a new product line and market differentiation through data-driven pricing
   • BIt simplifies the company's IT infrastructure by removing legacy systems
   • CIt guarantees higher profits for every policyholder
   • DIt reduces the need for any customer data collection in the future
   Reveal Solution Discussion Select an answer first
2. 2expert · hard

   A large airline has two competing analytics proposals. Proposal A uses historical flight data to optimize fuel consumption, potentially saving $5 million annually. Proposal B uses customer data to build a loyalty program that could increase revenue by $8 million annually, but requires a $2 million annual data-licensing cost. The CFO asks which proposal to fund first. What is the most defensible business driver-based decision?

   • AFund both equally because all analytics initiatives are equally valuable
   • BFund Proposal B because its net benefit is higher, despite the licensing cost
   • CFund Proposal A because cost reduction is always a more reliable driver than revenue growth
   • DFund neither because both proposals rely on data that may be incomplete
   Reveal Solution Discussion Select an answer first
4. 3foundation · medium

   How does Big Data relate to data science?

   • ABig Data is a subset of data science that focuses on storage
   • BBig Data and data science are unrelated fields
   • CData science is only applicable to small, structured datasets
   • DBig Data is the raw material that data science analyzes to generate insights
   Reveal Solution Discussion Select an answer first
5. 4expert · hard

   A food delivery company has two analytics opportunities. Opportunity 1: optimize delivery routes to reduce fuel costs by 10%, saving $2 million annually. Opportunity 2: use customer order data to create a subscription service, projected to add $3 million in annual revenue but requiring $1.5 million in upfront marketing. The company has limited capital and wants the fastest payback. Which opportunity should they prioritize?

   • AOpportunity 2, because its gross revenue is higher than Opportunity 1's savings
   • BBoth equally, because all analytics projects are equally important
   • COpportunity 1, because it has no upfront cost and delivers immediate savings
   • DNeither, because the savings and revenue projections are uncertain
   Reveal Solution Discussion Select an answer first
6. 5foundation · medium

   Which of the following is a primary business driver for adopting Big Data analytics?

   • AEliminating all human decision-making
   • BGuaranteeing a positive return on investment
   • CReducing the need for data governance
   • DAchieving operational efficiency through data-driven process optimization
   Reveal Solution Discussion Select an answer first