Comprehensive and Detailed Explanation (AWS AI documents):

AWS generative AI documentation defines hallucinations as a condition in which a generative model produces outputs that appear fluent, confident, and plausible but are factually incorrect or not grounded in the training data or provided context.

Limited or insufficient training data increases the likelihood of hallucinations because the model lacks enough factual grounding to generate reliable responses. This behavior is a well-known challenge in large language models and foundation models.

Why the other options are incorrect:

Interpretability refers to understanding how a model arrives at its predictions.

Nondeterminism refers to variation in outputs across runs due to probabilistic sampling.

Accuracy is a general performance metric, not the specific phenomenon described.

AWS AI Study Guide References:

AWS generative AI challenges and limitations

AWS guidance on hallucinations in foundation models

Transfer learning is a machine learning technique that reuses knowledge learned from previous tasks to improve training efficiency and performance on new tasks. AWS documentation explains that transfer learning allows models to start from pretrained weights or representations, reducing training time and the amount of data required.

In this retail application scenario, the company wants to leverage information from prior tasks to increase learning speed, which is a defining characteristic of transfer learning. AWS emphasizes that transfer learning is especially effective when tasks are related, such as customer behavior analysis, product recommendations, or demand forecasting.

By initializing a model with learned features from an existing task, transfer learning enables faster convergence and improved accuracy compared to training from scratch. AWS frequently recommends this approach when computational efficiency and rapid iteration are important.

The other options do not satisfy the requirement. Supervised learning defines how labels are used but does not reuse prior knowledge. Hyperparameter tuning optimizes model configuration but does not leverage previous task outputs. Regularization techniques reduce overfitting but do not accelerate learning through knowledge reuse.

AWS documentation positions transfer learning as a foundational concept in modern ML workflows, particularly for retail, personalization, and natural language processing use cases. Therefore, transfer learning is the correct solution.

AWS CloudTrail: Logs all API calls to Amazon Bedrock.

Amazon S3 Intelligent-Tiering: Optimizes storage costs for long-term retention with automatic tiering.

According to Amazon Bedrock Logging Documentation:

“CloudTrail records API activity and events, and logs can be stored in S3. For cost optimization, use S3 Intelligent-Tiering to retain logs long-term.”

Model fine-tuning adapts a pre-trained model to a specific domain or task using labeled data. This is the preferred approach when you want highly customized behavior for a particular application or subject area.

(Reference: Amazon Bedrock Fine-Tuning)

Data augmentation is used to artificially increase the size of a labeled dataset, usually by transforming or generating variations of the original data. This helps improve model generalization when labeled data is limited.

(Reference: AWS Data Preparation Techniques, AWS AI Practitioner Guide)

Continued pre-training (also called domain-adaptive pre-training) further trains a foundation model on large amounts of unlabeled data from a specific domain, improving the model’s language understanding or generation for that domain.

(Reference: Amazon Bedrock Customization Options)

Exploratory data analysis (EDA) involves understanding the data by visualizing it, calculating statistics, and creating correlation matrices. This stage helps identify patterns, relationships, and anomalies in the data, which can guide further steps in the ML pipeline.

Option C (Correct): "Exploratory data analysis": This is the correct answer as the tasks described (correlation matrix, calculating statistics, visualizing data) are all part of the EDA process.

Option A: "Data pre-processing" is incorrect because it involves cleaning and transforming data, not initial analysis.

Option B: "Feature engineering" is incorrect because it involves creating new features from raw data, not analyzing the data's existing structure.

Option D: "Hyperparameter tuning" is incorrect because it refers to optimizing model parameters, not analyzing the data.

AWS AI Practitioner References:

Stages of the Machine Learning Pipeline: AWS outlines EDA as the initial phase of understanding and exploring data before moving to more specific preprocessing, feature engineering, and model training stages.

The correct answer is Data residency, which ensures that data remains stored and processed within specific geographical or jurisdictional boundaries. AWS defines data residency as the practice of keeping sensitive or regulated data, such as healthcare records, inside designated regions to meet local privacy laws like HIPAA or GDPR. Amazon SageMaker, Bedrock, and other AWS services allow region-specific resource deployment, guaranteeing data never leaves the country. Data quality refers to accuracy and consistency, while discoverability and enrichment concern accessibility and augmentation, not compliance. Data residency is central to AWS’s Shared Responsibility Model, ensuring organizations maintain sovereignty over healthcare data.

Referenced AWS AI/ML Documents and Study Guides:

AWS Data Privacy Whitepaper – Data Residency and Compliance

AWS ML Specialty Guide – Data Governance and Security

To determine customer sentiments based on written customer reviews, the company can use Amazon Comprehend and Amazon Bedrock.

Amazon Comprehend:

A natural language processing (NLP) service that uses machine learning to uncover insights and relationships in text.

Can analyze customer reviews to detect sentiments (positive, negative, neutral, or mixed) automatically.

Amazon Bedrock:

Provides access to foundational models (FMs) from multiple AI companies for tasks such as text generation, summarization, and sentiment analysis.

The company can use a pre-trained sentiment analysis model available on Amazon Bedrock for processing customer reviews.

Why Other Options are Incorrect:

A. Amazon Lex: Used for building conversational interfaces like chatbots, not for sentiment analysis.

C. Amazon Polly: Converts text to speech; it doesn't analyze sentiment.

E. Amazon Rekognition: Analyzes images and videos, not text.