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Errors and Their Implications

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It has been said that from the point of view of the general population, Type I errors are particularly undesirable. This has been used as a justification for setting alpha at such low levels as .05 and .01.

Does this make sense? Explain your response.
What are the implications of making a Type I error, as compared to those of making a Type II error?
Describe the ethical issues in this trade-off.

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Solution Summary

This solution discusses errors and their implications. It compares Type I and Type II errors and discusses ethical issues in hypothesis testing. The explanation is given in 297 words.

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Let's look at these errors in the context of a real-world problem, say, drug testing. Frequently, before drugs are made available to the mass markets, the pharmaceutical companies will need to demonstrate these drugs' effectiveness on a small sample.

These types of experimental runs are usually like a hypothesis test where the null hypothesis is that the drug is ineffective by some quantitative criterion and that the ...

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