Applications of foundation models

AIF-C01 notes, 28% of the exam, updated November 2026

This is the biggest domain at 28% of the scored exam. Expect scenario questions: “which customisation approach is cheapest for this need”, “what does lowering temperature do”, “which prompt technique”, “which metric evaluates summaries”, “where do embeddings live”. Learn the ladder of customisation, the prompt techniques, and the metric names.

Selecting a pre-trained model

Criterion What to ask
Cost Price per token or per image; provisioned throughput needs
Modality Text, image, audio, video, embeddings, multimodal input
Latency Real-time chat needs a fast, smaller model
Multilingual Does it support the languages you need?
Model size and complexity Larger is usually more capable, slower and costlier
Customisation Can you fine-tune or continue pre-training it?
Input and output length Context window and maximum output tokens
Compliance and licensing Region availability, terms, data handling

Test several models on your own prompts. A smaller model that meets the quality bar is the right answer when cost or latency matters.

Inference parameters

These settings shape the response without changing the model.

Parameter Effect
Temperature Randomness. Low (near 0) is focused, predictable and repeatable: facts, extraction, code. High is more varied and creative: brainstorming, stories
Top-p (nucleus sampling) Considers only the smallest set of likely tokens whose combined probability reaches p. Lower is more conservative
Top-k Considers only the k most likely next tokens. Lower is more conservative
Maximum tokens / response length Caps output size; controls cost and cut-off
Stop sequences Strings that make the model stop
Input length Limited by the context window; long inputs cost more

Temperature, top-p and top-k change randomness. They don’t add knowledge or fix hallucinations.

Retrieval Augmented Generation (RAG)

RAG gives the model relevant information at question time instead of retraining it. The model answers from retrieved passages placed in the prompt.

How it works

  1. Ingest: split documents into chunks, create an embedding of each with an embedding model, and store the vectors in a vector database (with the text and metadata).
  2. Retrieve: embed the user’s question, find the nearest vectors (semantic similarity search).
  3. Augment: add the retrieved passages to the prompt.
  4. Generate: the FM answers using that context, often with source citations.
  • Brings in current and private data without retraining.
  • Reduces hallucinations by grounding answers in sources.
  • Data stays in your control and can be updated by re-indexing.
  • Cheaper and faster than fine-tuning.
  • Permissions can be enforced on retrieval.

Business uses: customer support bots, internal knowledge assistants, policy and legal research, product Q&A, document search.

Amazon Bedrock Knowledge Bases

A fully managed RAG capability. You point it at a data source (S3, web crawler, Confluence, SharePoint, Salesforce and others); it chunks, embeds, stores and retrieves. You choose the embedding model and vector store. APIs include Retrieve (just passages) and RetrieveAndGenerate (full answer with citations). It can also query structured data stores by generating SQL.

AWS vector store options

Service Notes
Amazon OpenSearch Service (and OpenSearch Serverless) Vector search engine; common default
Amazon Aurora PostgreSQL (and RDS for PostgreSQL) pgvector extension; good when data is already relational
Amazon Neptune Graph database; vector search plus graph relationships (GraphRAG)
Amazon DocumentDB (MongoDB compatibility) Vector search on document data
Amazon MemoryDB / ElastiCache In-memory vector search for very low latency
Amazon S3 Vectors Low-cost vector storage in S3
Third-party (Pinecone, Redis Enterprise Cloud, MongoDB Atlas) Supported by Knowledge Bases

The exam names OpenSearch, Aurora, Neptune, DocumentDB and RDS for PostgreSQL. A question that says “the team already uses PostgreSQL and wants to add vector search” points to Aurora or RDS for PostgreSQL with pgvector.

RAG versus Amazon Kendra

Kendra is an intelligent enterprise search service with connectors and natural-language queries; it can also act as a retriever for RAG. Knowledge Bases is the usual Bedrock-native RAG answer.

Agents for Amazon Bedrock

An agent lets an FM handle multi-step tasks: it reasons about a goal, breaks it into steps, calls action groups (APIs backed by Lambda functions, defined by an OpenAPI schema or function details), queries knowledge bases, and keeps conversation memory. Example: “rebook my flight” means looking up the booking, checking availability, calling the change API, and confirming. Bedrock AgentCore provides managed infrastructure to run and secure agents at scale, and Bedrock Flows chain prompts, models and services in a visual workflow. Agents can be wrapped with Guardrails, and you can trace each reasoning step.

Customising a foundation model: cost tradeoffs

From cheapest and simplest to most expensive:

Approach What changes Cost and effort Use when
Prompt engineering / in-context learning Only the prompt (instructions, examples) Lowest; no training Start here always
RAG Adds external knowledge at query time Low to moderate; needs a vector store and ingestion Answers need current or private data
Fine-tuning Updates the model’s weights with labeled examples High: training compute, data prep, hosting a custom model (provisioned throughput in Bedrock) Specialised style, format or task behaviour
Continued pre-training Further unsupervised training on a large domain corpus Higher The model lacks domain vocabulary and knowledge
Pre-training from scratch Train an entire new model Highest by far (millions, huge data) Almost never

Distillation (training a small model to mimic a large one) is another way to cut inference cost.

Mnemonic: prompt, RAG, fine-tune, continue pre-training, pre-train. Choose the lowest rung that meets the need.

Prompt engineering

Constructs

Element Purpose
Instruction The task to do
Context Background information, retrieved passages
Input data What to process
Output indicator / format The shape of the answer (JSON, bullets, length)
Persona / role “You are a tax advisor”
Negative prompt What to avoid or exclude (common in image generation, and for text: “do not mention pricing”)
Model latent space The model’s internal learned representation; prompts steer which regions of what it learned the model draws on

Techniques

Technique What you do
Zero-shot Ask with no examples
Single-shot (one-shot) Give one example
Few-shot Give several examples so the model copies the pattern and format
Chain-of-thought (CoT) Ask for step-by-step reasoning (“think step by step”); improves maths and logic
Prompt template A reusable prompt with placeholders for variable input; gives consistency; Bedrock Prompt Management stores them
Role prompting Assign a persona
Self-consistency / ReAct Sample several reasoning paths, or alternate reasoning with tool actions

Best practices

Be specific and concise; state the format; give examples; put instructions clearly apart from data (delimiters); break complex tasks into steps; experiment and iterate and keep what works; set guardrails for safety. Longer and vaguer prompts usually perform worse than clear ones.

Risks and limits

Risk Meaning
Prompt injection / hijacking Malicious text in the input or retrieved data overrides instructions and redirects the model
Jailbreaking Prompts crafted to get around the model’s safety rules
Poisoning Harmful data planted in training data or retrieved documents so the model misbehaves
Exposure Prompts or outputs leak sensitive data or the system prompt
Hallucination and inconsistency Output varies and can be wrong

Defences: input and output filtering (Bedrock Guardrails), least-privilege for agent tools, treat retrieved content as untrusted, human review for high-impact actions.

Training and fine-tuning

Training stages

  • Pre-training: self-supervised learning on massive unlabeled data (predict the next token). Produces the general-purpose FM.
  • Fine-tuning: supervised training on a smaller labeled dataset for a task or domain.
  • Continued pre-training: keeps training on unlabeled domain data (medical, legal) to add knowledge, using the same objective as pre-training.

Fine-tuning methods

Method Meaning
Instruction tuning Train on prompt and ideal response pairs so the model follows instructions better
Domain adaptation Fine-tune on industry-specific data
Transfer learning Reuse a model trained on one task as the starting point for another; the general idea behind all fine-tuning
Parameter-efficient fine-tuning (PEFT, for example LoRA) Update only a small number of added parameters; cheaper and faster
RLHF Humans rank outputs, a reward model is trained from those rankings, and the model is optimised to produce preferred responses (more helpful, less harmful)

Bedrock offers fine-tuning (labeled prompt and completion pairs in S3) and continued pre-training (unlabeled data) for supported models; the result is a private custom model served with provisioned throughput.

Preparing fine-tuning data

  • Data curation: clean, deduplicate, remove errors and harmful content.
  • Governance: you have rights to the data; privacy and PII handled; lineage recorded.
  • Size: enough examples (hundreds to thousands for fine-tuning; far more for continued pre-training); quality beats quantity.
  • Labeling: accurate, consistent labels or ideal responses (SageMaker Ground Truth, human annotators).
  • Representativeness: covers the real range of inputs and groups the model will see.
  • RLHF data: human preference rankings.

Common failure: catastrophic forgetting, where fine-tuning erodes general abilities.

Evaluating foundation models

Approaches

Approach Notes
Human evaluation People rate helpfulness, accuracy, tone. Slow and costly but captures what metrics miss
Benchmark datasets Standard test sets (for example GLUE, SuperGLUE, MMLU, HELM) compare models on common tasks
Automatic metrics Computed scores against reference answers
LLM-as-a-judge Another model grades outputs

Amazon Bedrock model evaluation supports automatic, human (your own team or an AWS-managed team) and LLM-as-a-judge evaluation, including RAG evaluation. SageMaker Clarify and FMEval also evaluate FMs.

Metrics

Metric Measures Typical task
ROUGE (Recall-Oriented Understudy for Gisting Evaluation) Overlap of n-grams and sequences between generated and reference text, recall-oriented Summarisation
BLEU (Bilingual Evaluation Understudy) n-gram precision against reference translations Machine translation
BERTScore Semantic similarity using embeddings, so paraphrases score well Text generation where wording differs
Perplexity How well the model predicts text; lower is better Language modelling
F1, accuracy Classification tasks Q&A with exact answers, classification

Rule: ROUGE equals summaries; BLEU equals translation; BERTScore equals meaning rather than exact words.

Does it meet business goals?

Tie the model to outcomes: productivity (time saved), user engagement (usage, satisfaction, retention), and task completion or quality on the real job. Run an A/B test or pilot. Cost per task and latency matter as much as scores.

Common traps

  • A question needs up-to-date company data, and an option says fine-tune. Choose RAG.
  • Fine-tuned custom models in Bedrock need provisioned throughput.
  • “Make the output more deterministic” means lower temperature.
  • ROUGE is for summarisation, BLEU for translation.
  • Prompt engineering needs no training and is always the first thing to try.
  • Embeddings stored in a vector database are the retrieval index; they are not the generator.

Exam checklist

  • List selection criteria for a model.
  • State what temperature, top-p, top-k and max tokens do.
  • Describe the four RAG steps and name five AWS vector store options.
  • Explain what a Bedrock agent does and what an action group is.
  • Order customisation approaches by cost.
  • Distinguish zero-shot, one-shot, few-shot and chain-of-thought; name four prompt risks.
  • Distinguish pre-training, fine-tuning, continued pre-training, instruction tuning and RLHF.
  • Match ROUGE, BLEU and BERTScore to tasks.

Test what you just read. 23 practice questions on applications of foundation models.

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