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Types of Error

In: Better Business Decisions from Data

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  • Peter Kenny

Abstract

Whenever a significance level is quoted, there is a chance that the stated result is incorrect. If the null hypothesis is rejected when, in fact, it is correct, the error is referred to as a Type I error. So, if our null hypothesis is that there is no significant difference between the mean marks from the boys’ results and the girls’ results in the same examination, we may decide that there is a difference, at the 5% level, say. If in fact there is no difference, and our result is simply due to the random effect embodied in our 1-in-20 chance of being wrong, then a Type I error has occurred.

Suggested Citation

  • Peter Kenny, 2014. "Types of Error," Springer Books, in: Better Business Decisions from Data, chapter 0, pages 115-118, Springer.
    • Handle: RePEc:spr:sprchp:978-1-4842-0184-8_12
    DOI: 10.1007/978-1-4842-0184-8_12
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