Suppose that our client is a retailer seeking to maximize revenue from a direct marketing mailing of coupons to likely customers for an upcoming sale. A positive response represents a customer who will shop the sale and spend money. A negative response represents a customer who will not shop the sale and spend money. Suppose that mailing a coupon to a customer costs $5, and that previous experience suggests that those who shopped similar sales spent an average of $100.

Use Result 3 to readjust the adjusted misclassification costs, so that the readjusted false negative cost is $1. Interpret the readjusted false positive and false negative costs.