Classification Problems

5.1 Classification Overview

5.3 Credit Classification

import warnings
warnings.filterwarnings('ignore')
import pandas as pd
import numpy as np

credit_df = pd.read_csv( "German Credit Data.csv" )

credit_df.info()
<class 'pandas.core.frame.DataFrame'>
RangeIndex: 1000 entries, 0 to 999
Data columns (total 14 columns):
checkin_acc 1000 non-null object
duration 1000 non-null int64
credit_history 1000 non-null object
amount 1000 non-null int64
savings_acc 1000 non-null object
present_emp_since 1000 non-null object
inst_rate 1000 non-null int64
personal_status 1000 non-null object
residing_since 1000 non-null int64
age 1000 non-null int64
inst_plans 1000 non-null object
num_credits 1000 non-null int64
job 1000 non-null object
status 1000 non-null int64
dtypes: int64(7), object(7)
memory usage: 109.5+ KB

credit_df.iloc[0:5,1:7]

duration credit_history amount savings_acc present_emp_since inst_rate

0 6 A34 1169 A65 A75 4

1 48 A32 5951 A61 A73 2

2 12 A34 2096 A61 A74 2

3 42 A32 7882 A61 A74 2

4 24 A33 4870 A61 A73 3

credit_df.iloc[0:5,7:]

personal_status residing_since age inst_plans num_credits job status

0 A93 4 67 A143 2 A173 0

1 A92 2 22 A143 1 A173 1

2 A93 3 49 A143 1 A172 0

3 A93 4 45 A143 1 A173 0

4 A93 4 53 A143 2 A173 1

credit_df.status.value_counts()
0 700
1 300
Name: status, dtype: int64

X_features = list( credit_df.columns )

X_features.remove( 'status' )
X_features
['checkin_acc',
'duration',
'credit_history',
'amount',
'savings_acc',
'present_emp_since',
'inst_rate',
'personal_status',
'residing_since',
'age',
'inst_plans',
'num_credits',
'job']

5.3.1 Encoding Categorical Features

encoded_credit_df = pd.get_dummies( credit_df[X_features],

drop_first = True )
list(encoded_credit_df.columns)
['duration',
'amount',
'inst_rate',
'residing_since',
'age',
'num_credits',
'checkin_acc_A12',
'checkin_acc_A13',
'checkin_acc_A14',
'credit_history_A31',
'credit_history_A32',
'credit_history_A33',
'credit_history_A34',
'savings_acc_A62',
'savings_acc_A63',
'savings_acc_A64',
'savings_acc_A65',
'present_emp_since_A72',
'present_emp_since_A73',
'present_emp_since_A74',
'present_emp_since_A75',
'personal_status_A92',
'personal_status_A93',
'personal_status_A94',
'inst_plans_A142',
'inst_plans_A143',
'job_A172',
'job_A173',
'job_A174']

encoded_credit_df[['checkin_acc_A12',
'checkin_acc_A13',
'checkin_acc_A14']].head(5)

checkin_acc_A12 checkin_acc_A13 checkin_acc_A14

0 0 0 0

1 1 0 0

2 0 0 1

3 0 0 0

4 0 0 0

import statsmodels.api as sm

Y = credit_df.status
X = sm.add_constant( encoded_credit_df )

5.3.2 Splitting into Train and Validation Sets

from sklearn.model_selection import train_test_split

X_train, X_test, y_train, y_test = train_test_split(X,

Y,
test_size = 0.3,
random_state = 42)

5.3.3 Building Logistic Regression Model

import statsmodels.api as sm

logit = sm.Logit(y_train, X_train)

logit_model = logit.fit()

Optimization terminated successfully.

Current function value: 0.488938
Iterations 6

5.3.4 Printing Model Summary

logit_model.summary2()
Model: Logit Pseudo R-squared: 0.198

Dependent Variable: status AIC: 744.5132

Date: 2019-04-23 21:07 BIC: 881.0456

No. Observations: 700 Log-Likelihood: -342.26

Df Model: 29 LL-Null: -426.75

Df Residuals: 670 LLR p-value: 1.0630e-21

Converged: 1.0000 Scale: 1.0000

No. Iterations: 6.0000

Coef. Std.Err. z P>|z| [0.025 0.975]

const -0.1511 1.1349 -0.1331 0.8941 -2.3754 2.0733

duration 0.0206 0.0104 1.9927 0.0463 0.0003 0.0409

amount 0.0001 0.0000 2.3765 0.0175 0.0000 0.0002

inst_rate 0.3064 0.0986 3.1083 0.0019 0.1132 0.4996

residing_since 0.0967 0.0920 1.0511 0.2932 -0.0836 0.2771

age -0.0227 0.0103 -2.2131 0.0269 -0.0428 -0.0026

num_credits 0.2854 0.2139 1.3342 0.1821 -0.1338 0.7045

checkin_acc_A12 -0.4126 0.2391 -1.7260 0.0843 -0.8812 0.0559

checkin_acc_A13 -0.9053 0.4338 -2.0868 0.0369 -1.7556 -0.0550

checkin_acc_A14 -1.6052 0.2586 -6.2073 0.0000 -2.1120 -1.0983

credit_history_A31 0.1532 0.5795 0.2643 0.7916 -0.9827 1.2890

credit_history_A32 -0.4960 0.4411 -1.1245 0.2608 -1.3604 0.3685

credit_history_A33 -0.8881 0.5022 -1.7683 0.0770 -1.8724 0.0962

credit_history_A34 -1.4124 0.4528 -3.1190 0.0018 -2.2999 -0.5249

savings_acc_A62 -0.0496 0.3208 -0.1545 0.8772 -0.6782 0.5791

savings_acc_A63 -0.6640 0.4818 -1.3779 0.1682 -1.6084 0.2804

savings_acc_A64 -1.1099 0.6019 -1.8439 0.0652 -2.2896 0.0699

savings_acc_A65 -0.6061 0.2745 -2.2080 0.0272 -1.1441 -0.0681

present_emp_since_A72 0.0855 0.4722 0.1810 0.8564 -0.8401 1.0110

present_emp_since_A73 -0.0339 0.4492 -0.0754 0.9399 -0.9142 0.8465

present_emp_since_A74 -0.3789 0.4790 -0.7910 0.4289 -1.3178 0.5600

present_emp_since_A75 -0.2605 0.4554 -0.5721 0.5673 -1.1532 0.6321

personal_status_A92 -0.0069 0.4841 -0.0142 0.9887 -0.9557 0.9419

personal_status_A93 -0.4426 0.4764 -0.9291 0.3528 -1.3762 0.4911

personal_status_A94 -0.3080 0.5554 -0.5546 0.5792 -1.3967 0.7806

inst_plans_A142 -0.2976 0.5157 -0.5772 0.5638 -1.3084 0.7131

inst_plans_A143 -0.4458 0.2771 -1.6086 0.1077 -0.9889 0.0974

job_A172 -0.0955 0.7681 -0.1243 0.9011 -1.6009 1.4100

job_A173 -0.0198 0.7378 -0.0269 0.9786 -1.4658 1.4262

job_A174 -0.0428 0.7371 -0.0581 0.9537 -1.4876 1.4019

5.3.5 Model Dignostics

def get_significant_vars( lm ):
var_p_vals_df = pd.DataFrame( lm.pvalues )
var_p_vals_df['vars'] = var_p_vals_df.index
var_p_vals_df.columns = ['pvals', 'vars']
return list( var_p_vals_df[var_p_vals_df.pvals <= 0.05]['vars'] )

significant_vars = get_significant_vars( logit_model )

significant_vars
['duration',
'amount',
'inst_rate',
'age',
'checkin_acc_A13',
'checkin_acc_A14',
'credit_history_A34',
'savings_acc_A65']

final_logit = sm.Logit( y_train,

sm.add_constant( X_train[significant_vars] ) ).fit()
Optimization terminated successfully.
Current function value: 0.511350
Iterations 6
final_logit.summary2()

Model: Logit Pseudo R-squared: 0.161

Dependent Variable: status AIC: 733.8898

Date: 2019-04-23 21:07 BIC: 774.8495

No. Observations: 700 Log-Likelihood: -357.94

Df Model: 8 LL-Null: -426.75

Df Residuals: 691 LLR p-value: 7.4185e-26

Converged: 1.0000 Scale: 1.0000

No. Iterations: 6.0000

Coef. Std.Err. z P>|z| [0.025 0.975]

const -0.8969 0.4364 -2.0551 0.0399 -1.7523 -0.0415

duration 0.0197 0.0098 2.0033 0.0451 0.0004 0.0390

amount 0.0001 0.0000 2.3205 0.0203 0.0000 0.0002

inst_rate 0.2811 0.0929 3.0264 0.0025 0.0991 0.4632

age -0.0216 0.0089 -2.4207 0.0155 -0.0392 -0.0041

checkin_acc_A13 -0.8038 0.4081 -1.9697 0.0489 -1.6037 -0.0040

checkin_acc_A14 -1.5452 0.2187 -7.0649 0.0000 -1.9738 -1.1165

credit_history_A34 -0.8781 0.2319 -3.7858 0.0002 -1.3327 -0.4235

savings_acc_A65 -0.5448 0.2581 -2.1108 0.0348 -1.0507 -0.0389

5.3.6 Predicting on Test Data

y_pred_df = pd.DataFrame( { "actual": y_test,

"predicted_prob": final_logit.predict(
sm.add_constant( X_test[significant_vars] ) ) } )
y_pred_df.sample(10, random_state = 42)

actual predicted_prob

557 1 0.080493

798 0 0.076653

977 0 0.345979

136 0 0.249919

575 0 0.062264

544 0 0.040768

332 1 0.833093

917 1 0.370667

678 0 0.388392

363 0 0.088952

y_pred_df['predicted'] = y_pred_df.predicted_prob.map(
lambda x: 1 if x > 0.5 else 0)

y_pred_df.sample(10, random_state = 42)

actual predicted_prob predicted

557 1 0.080493 0

798 0 0.076653 0

977 0 0.345979 0

136 0 0.249919 0

575 0 0.062264 0

544 0 0.040768 0

332 1 0.833093 1

917 1 0.370667 0

678 0 0.388392 0

363 0 0.088952 0

5.3.7 Creating a Confusion Matrix

import matplotlib.pyplot as plt

import seaborn as sn
%matplotlib inline
from sklearn import metrics
def draw_cm( actual, predicted ):
## Cret
cm = metrics.confusion_matrix( actual, predicted, [1,0] )
sn.heatmap(cm, annot=True, fmt='.2f',
xticklabels = ["Bad credit", "Good Credit"] ,
yticklabels = ["Bad credit", "Good Credit"] )
plt.ylabel('True label')
plt.xlabel('Predicted label')
plt.show()

draw_cm( y_pred_df.actual,
y_pred_df.predicted )

5.3.8 Measuring Accuracies

print( metrics.classification_report( y_pred_df.actual,

y_pred_df.predicted ) )

precision recall f1-score support

0 0.76 0.90 0.82 209

1 0.59 0.33 0.42 91

micro avg 0.73 0.73 0.73 300

macro avg 0.67 0.61 0.62 300
weighted avg 0.70 0.73 0.70 300
plt.figure( figsize = (8,6) )
sn.distplot( y_pred_df[y_pred_df.actual == 1]["predicted_prob"],
kde=False, color = 'b',
label = 'Bad Credit' )
sn.distplot( y_pred_df[y_pred_df.actual == 0]["predicted_prob"],
kde=False, color = 'g',
label = 'Good Credit' )
plt.legend()
plt.show()

5.3.9 ROC & AUC

def draw_roc( actual, probs ):

fpr, \
tpr, \
thresholds = metrics.roc_curve( actual,
probs,
drop_intermediate = False )
auc_score = metrics.roc_auc_score( actual, probs )
plt.figure(figsize=(8, 6))
plt.plot( fpr, tpr, label='ROC curve (area = %0.2f)' % auc_score )
plt.plot([0, 1], [0, 1], 'k--')
plt.xlim([0.0, 1.0])
plt.ylim([0.0, 1.05])
plt.xlabel('False Positive Rate or [1 - True Negative Rate]')
plt.ylabel('True Positive Rate')
plt.legend(loc="lower right")
plt.show()

return fpr, tpr, thresholds

fpr, tpr, thresholds = draw_roc( y_pred_df.actual,
y_pred_df.predicted_prob)

auc_score = metrics.roc_auc_score( y_pred_df.actual,

y_pred_df.predicted_prob )
round( float( auc_score ), 2 )
0.78

5.3.10 Finding Optimal Cutoff

5.3.10.1 Youden's index

tpr_fpr = pd.DataFrame( { 'tpr': tpr,

'fpr': fpr,
'thresholds': thresholds } )

tpr_fpr['diff'] = tpr_fpr.tpr - tpr_fpr.fpr

tpr_fpr.sort_values( 'diff', ascending = False )[0:5]

fpr thresholds tpr diff

160 0.397129 0.221534 0.846154 0.449025

161 0.401914 0.216531 0.846154 0.444240

162 0.406699 0.215591 0.846154 0.439455

159 0.397129 0.223980 0.835165 0.438036

166 0.421053 0.207107 0.857143 0.436090

y_pred_df['predicted_new'] = y_pred_df.predicted_prob.map(
lambda x: 1 if x > 0.22 else 0)

draw_cm( y_pred_df.actual,
y_pred_df.predicted_new)

print(metrics.classification_report( y_pred_df.actual,
y_pred_df.predicted_new ))

precision recall f1-score support

0 0.90 0.60 0.72 209

1 0.48 0.85 0.61 91

micro avg 0.68 0.68 0.68 300

macro avg 0.69 0.72 0.67 300
weighted avg 0.77 0.68 0.69 300

5.3.10.2 Cost Based Approach

def get_total_cost( actual, predicted, cost_FPs, cost_FNs ):

cm = metrics.confusion_matrix( actual, predicted, [1,0] )
cm_mat = np.array( cm )
return cm_mat[0,1] * cost_FNs + cm_mat[1,0] * cost_FPs

cost_df = pd.DataFrame( columns = ['prob', 'cost'])

idx = 0

## iterate cut-off probability values between 0.1 and 0.5

for each_prob in range( 10, 50):
cost = get_total_cost( y_pred_df.actual,
y_pred_df.predicted_prob.map(
lambda x: 1 if x > (each_prob/100) else 0), 1, 5 )
cost_df.loc[idx] = [(each_prob/100), cost]
idx += 1
cost_df.sort_values( 'cost', ascending = True )[0:5]

prob cost

4 0.14 150.0

12 0.22 153.0

2 0.12 154.0

10 0.20 154.0

9 0.19 156.0

y_pred_df['predicted_using_cost'] = y_pred_df.predicted_prob.map(
lambda x: 1 if x > 0.14 else 0)

draw_cm( y_pred_df.actual,
y_pred_df.predicted_using_cost )

5.4 Gain Chart and Lift Chart

5.4.1 Loading and Preparing the Dataset

import pandas as pd
bank_df = pd.read_csv( 'bank.csv' )
bank_df.head( 5 )

housing- personal- curre

age job marital education default balance
loan loan campa

0 30 unemployed married primary no 1787 no no 1

1 33 services married secondary no 4789 yes yes 1

2 35 management single tertiary no 1350 yes no 1

3 30 management married tertiary no 1476 yes yes 4

4 59 blue-collar married secondary no 0 yes no 1

bank_df.info()
<class 'pandas.core.frame.DataFrame'>
RangeIndex: 4521 entries, 0 to 4520
Data columns (total 11 columns):
age 4521 non-null int64
job 4521 non-null object
marital 4521 non-null object
education 4521 non-null object
default 4521 non-null object
balance 4521 non-null int64
housing-loan 4521 non-null object
personal-loan 4521 non-null object
current-campaign 4521 non-null int64
previous-campaign 4521 non-null int64
subscribed 4521 non-null object
dtypes: int64(4), object(7)
memory usage: 388.6+ KB

X_features = list( bank_df.columns )

X_features.remove( 'subscribed' )
X_features
['age',
'job',
'marital',
'education',
'default',
'balance',
'housing-loan',
'personal-loan',
'current-campaign',
'previous-campaign']

encoded_bank_df = pd.get_dummies( bank_df[X_features],

drop_first = True )

Y = bank_df.subscribed.map( lambda x: int( x == 'yes') )

X = encoded_bank_df
5.4.2 Building the Logistic Regression Model

logit_model = sm.Logit( Y, sm.add_constant( X ) ).fit()

Optimization terminated successfully.
Current function value: 0.335572
Iterations 7
logit_model.summary2()

Model: Logit Pseudo R-squared: 0.061

Dependent Variable: subscribed AIC: 3082.2384

Date: 2019-04-23 21:07 BIC: 3236.2341

No. Observations: 4521 Log-Likelihood: -1517.1

Df Model: 23 LL-Null: -1615.5

Df Residuals: 4497 LLR p-value: 1.4866e-29

Converged: 1.0000 Scale: 1.0000

No. Iterations: 7.0000

Coef. Std.Err. z P>|z| [0.025 0.975]

const -1.7573 0.3799 -4.6251 0.0000 -2.5019 -1.0126

age 0.0078 0.0058 1.3395 0.1804 -0.0036 0.0191

balance -0.0000 0.0000 -0.2236 0.8231 -0.0000 0.0000

current-campaign -0.0905 0.0238 -3.8042 0.0001 -0.1371 -0.0439

previous-campaign 0.1414 0.0212 6.6569 0.0000 0.0998 0.1830

job_blue-collar -0.3412 0.2000 -1.7060 0.0880 -0.7331 0.0508

job_entrepreneur -0.2900 0.3161 -0.9175 0.3589 -0.9096 0.3295

job_housemaid -0.0166 0.3339 -0.0497 0.9603 -0.6711 0.6379

job_management -0.0487 0.1984 -0.2455 0.8061 -0.4375 0.3401

job_retired 0.5454 0.2503 2.1794 0.0293 0.0549 1.0360

job_self-employed -0.2234 0.2895 -0.7715 0.4404 -0.7909 0.3441

job_services -0.2248 0.2245 -1.0012 0.3167 -0.6648 0.2152

job_student 0.3888 0.3181 1.2223 0.2216 -0.2346 1.0122

job_technician -0.2101 0.1874 -1.1213 0.2622 -0.5773 0.1571

job_unemployed -0.3723 0.3336 -1.1162 0.2643 -1.0261 0.2815

job_unknown 0.3193 0.4620 0.6913 0.4894 -0.5861 1.2248

marital_married -0.4012 0.1440 -2.7857 0.0053 -0.6835 -0.1189

marital_single -0.0463 0.1676 -0.2763 0.7823 -0.3749 0.2822

education_secondary 0.2128 0.1680 1.2670 0.2052 -0.1164 0.5420

education_tertiary 0.3891 0.1935 2.0103 0.0444 0.0098 0.7684

education_unknown -0.1956 0.2927 -0.6682 0.5040 -0.7693 0.3781

default_yes 0.2286 0.3670 0.6228 0.5334 -0.4908 0.9479

housing-loan_yes -0.5355 0.1024 -5.2273 0.0000 -0.7362 -0.3347

personal-loan_yes -0.7139 0.1689 -4.2268 0.0000 -1.0449 -0.3829

significant_vars = get_significant_vars( logit_model )

significant_vars
['const',
'current-campaign',
'previous-campaign',
'job_retired',
'marital_married',
'education_tertiary',
'housing-loan_yes',
'personal-loan_yes']

X_features = ['current-campaign',
'previous-campaign',
'job_retired',
'marital_married',
'education_tertiary',
'housing-loan_yes',
'personal-loan_yes']

logit_model_2 = sm.Logit( Y, sm.add_constant( X[X_features] ) ).fit()

Optimization terminated successfully.
Current function value: 0.337228
Iterations 7

logit_model_2.summary2()

Model: Logit Pseudo R-squared: 0.056

Dependent Variable: subscribed AIC: 3065.2182

Date: 2019-04-23 21:07 BIC: 3116.5501

No. Observations: 4521 Log-Likelihood: -1524.6

Df Model: 7 LL-Null: -1615.5

Df Residuals: 4513 LLR p-value: 8.1892e-36

Converged: 1.0000 Scale: 1.0000

No. Iterations: 7.0000

Coef. Std.Err. z P>|z| [0.025 0.975]

const -1.4754 0.1133 -13.0260 0.0000 -1.6974 -1.2534

current-campaign -0.0893 0.0236 -3.7925 0.0001 -0.1355 -0.0432

previous-campaign 0.1419 0.0211 6.7097 0.0000 0.1004 0.1833

job_retired 0.8246 0.1731 4.7628 0.0000 0.4853 1.1639

marital_married -0.3767 0.0969 -3.8878 0.0001 -0.5667 -0.1868

education_tertiary 0.2991 0.1014 2.9500 0.0032 0.1004 0.4978

housing-loan_yes -0.5834 0.0986 -5.9179 0.0000 -0.7767 -0.3902

personal-loan_yes -0.7025 0.1672 -4.2012 0.0000 -1.0302 -0.3748

y_pred_df = pd.DataFrame( { 'actual': Y,
'predicted_prob': logit_model_2.predict(
sm.add_constant( X[X_features] ) ) } )

sorted_predict_df = y_pred_df[['predicted_prob',
'actual']].sort_values( 'predicted_prob',
ascending = False )

num_per_decile = int( len( sorted_predict_df ) / 10 )

print( "Number of observations per decile: ", num_per_decile)
Number of observations per decile: 452

def get_deciles( df ):
df['decile'] = 1

idx = 0

for each_d in range( 0, 10 ):

df.iloc[idx:idx+num_per_decile, df.columns.get_loc('decile')] = each_d
idx += num_per_decile

df['decile'] = df['decile'] + 1

return df

deciles_predict_df = get_deciles( sorted_predict_df )

deciles_predict_df[0:10]

predicted_prob actual decile

3682 0.864769 0 1

97 0.828031 0 1

3426 0.706809 0 1

1312 0.642337 1 1

3930 0.631032 1 1

4397 0.619146 0 1

2070 0.609129 0 1

3023 0.573199 0 1

4080 0.572364 0 1

804 0.559350 0 1

gain_lift_df = pd.DataFrame(
deciles_predict_df.groupby(
'decile')['actual'].sum() ).reset_index()
gain_lift_df.columns = ['decile', 'gain']
gain_lift_df['gain_percentage'] = (100 *
gain_lift_df.gain.cumsum()/gain_lift_df.gain.sum())

gain_lift_df

decile gain gain_percentage

0 1 125 23.992322

1 2 83 39.923225

2 3 73 53.934741

3 4 53 64.107486

4 5 31 70.057582

5 6 46 78.886756

6 7 37 85.988484

7 8 28 91.362764

8 9 25 96.161228

9 10 20 100.000000

import matplotlib.pyplot as plt

import seaborn as sn
%matplotlib inline

plt.figure( figsize = (8,4))

plt.plot( gain_lift_df['decile'],
gain_lift_df['gain_percentage'], '-' )

plt.show()

Calculating Lift

gain_lift_df['lift'] = ( gain_lift_df.gain_percentage
/ ( gain_lift_df.decile * 10) )
gain_lift_df

decile gain gain_percentage lift

0 1 125 23.992322 2.399232

1 2 83 39.923225 1.996161

2 3 73 53.934741 1.797825

3 4 53 64.107486 1.602687

4 5 31 70.057582 1.401152

5 6 46 78.886756 1.314779

6 7 37 85.988484 1.228407

7 8 28 91.362764 1.142035

8 9 25 96.161228 1.068458

9 10 20 100.000000 1.000000

plt.figure( figsize = (8,4))

plt.plot( gain_lift_df['decile'], gain_lift_df['lift'], '-' )
plt.show()

5.5 Decision Trees

5.5.1 Split the dataset

Y = credit_df.status
X = encoded_credit_df

from sklearn.model_selection import train_test_split

X_train, X_test, y_train, y_test = train_test_split( X, Y,

test_size = 0.3,
random_state = 42)
5.5.2 Building Decision Tree classifier using Gini Criteria

from sklearn.tree import DecisionTreeClassifier

clf_tree = DecisionTreeClassifier(criterion = 'gini',

max_depth = 3 )

clf_tree.fit( X_train, y_train )

DecisionTreeClassifier(class_weight=None, criterion='gini', max_dept
h=3,
max_features=None, max_leaf_nodes=None,
min_impurity_decrease=0.0, min_impurity_split=None,
min_samples_leaf=1, min_samples_split=2,
min_weight_fraction_leaf=0.0, presort=False, random_stat
e=None,
splitter='best')

5.5.3 Measuring Test Accuracy

tree_predict = clf_tree.predict( X_test )

metrics.roc_auc_score( y_test, tree_predict )
0.5835743204164258

5.5.4 Displaying the Tree

from sklearn.tree import export_graphviz
import pydotplus as pdot
from IPython.display import Image

# Export the tree into odt file

export_graphviz( clf_tree,
out_file = "chd_tree.odt",
feature_names = X_train.columns,
class_names= ['Good Credit', 'Bad Credit'],
filled = True)

# Read the create the image file

chd_tree_graph = pdot.graphviz.graph_from_dot_file( 'chd_tree.odt' )
chd_tree_graph.write_jpg( 'chd_tree.png' )
# Render the png file
Image(filename='chd_tree.png')

5.5.5 Understanding Gini Impurity

gini_node_1 = 1 - pow(491/700, 2) - pow (209/700, 2)

print( round( gini_node_1, 4) )
0.4189

X_test.shape
(300, 29)

5.5.6 Building Decision Tree using Entropy Criteria

clf_tree_entropy = DecisionTreeClassifier( criterion = 'entropy',
max_depth = 3 )
clf_tree_entropy.fit( X_train, y_train )

# Export the tree into odt file

export_graphviz( clf_tree_entropy,
out_file = "chd_tree_entropy.odt",
feature_names = X_train.columns,
filled = True )

# Read the create the image file

chd_tree_graph = pdot.graphviz.graph_from_dot_file( 'chd_tree_entropy.odt' )
chd_tree_graph.write_jpg( 'chd_tree_entropy.png' )
# Render the png file
Image(filename='chd_tree_entropy.png')

Calculating entropy impurity

import math

entropy_node_1 = - (491/700) * math.log2(491/700) - (209/700) * math.log2(209/70

0)
print( round( entropy_node_1, 2) )
0.88

Measuring test accuracy

tree_predict = clf_tree_entropy.predict( X_test )

metrics.roc_auc_score( y_test, tree_predict )
0.5763972869236027

5.5.7 Finding optimal criteria and max_depth

from sklearn.model_selection import GridSearchCV

tuned_parameters = [{'criterion': ['gini','entropy'],

'max_depth': range(2,10)}]

clf_tree = DecisionTreeClassifier()

clf = GridSearchCV(clf_tree,
tuned_parameters,
cv=10,
scoring='roc_auc')

clf.fit(X_train, y_train )

/Users/manaranjan/anaconda/lib/python3.5/site-packages/sklearn/model
_selection/_search.py:841: DeprecationWarning: The default of the `i
id` parameter will change from True to False in version 0.22 and wil
l be removed in 0.24. This will change numeric results when test-set
sizes are unequal.
DeprecationWarning)

GridSearchCV(cv=10, error_score='raise-deprecating',
estimator=DecisionTreeClassifier(class_weight=None, criterion
='gini', max_depth=None,
max_features=None, max_leaf_nodes=None,
min_impurity_decrease=0.0, min_impurity_split=None,
min_samples_leaf=1, min_samples_split=2,
min_weight_fraction_leaf=0.0, presort=False, random_stat
e=None,
splitter='best'),
fit_params=None, iid='warn', n_jobs=None,
param_grid=[{'max_depth': range(2, 10), 'criterion': ['gini',
'entropy']}],
pre_dispatch='2*n_jobs', refit=True, return_train_score='war
n',
scoring='roc_auc', verbose=0)

clf.best_score_
0.6824299319727891

clf.best_params_
{'criterion': 'gini', 'max_depth': 2}