A company wants to use AI for budgeting.

Comprehensive and Detailed Explanation From Exact AWS AI documents:

Hallucinations occur when an AI model generates incorrect, fabricated, or misleading outputs that appear plausible but are factually wrong.

AWS generative AI guidance identifies hallucinations as:

A common limitation of generative models

A risk when models generate numerical or factual data

A key reason for validation and human review in critical use cases

Why the other options are incorrect:

Safety (B) relates to harmful or restricted content.

Interpretability (C) refers to understanding how a model makes decisions.

Cost (D) concerns operational expenses.

AWS AI document references:

Generative AI Risks and Limitations

Responsible Use of Foundation Models

Model Validation Best Practices