Type I and Type II Errors



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There are four possible outcomes in the hypothesis testing situation. The four possible outcomes are shown in the figure above. There are two possibilities for a correct decision and two possibilities for a wrong decision.


Correct decision happens when
  • H0 is false and it is rejected (This is our target)
  • H0 is true and it is not rejected
Incorrect decision happens when
  • H0 is false and it is not rejected
  • H0 is true and it is rejected (We must reduce this error)

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