Question

A Methods and Statistics student, Chris, has an accountant for a mother. She has been listening to Chris tell her about Type I errors and α = .05. She responds: “.05? That means you’re making an error one time in twenty! If I made errors 5 percent of the time I’d be out of a job so fast it would make your head spin! Those psychologists need to shape up and set their α level to something more reasonable, say .001 or .0001!” Is Chris’s mother’s interpretation that an alpha level of 5% means you will commit errors 5% of the time correct? Explain (2 points), and in addition making it clear what the advantages and/or disadvantages are of doing what Chris’s mother suggests (3 points).

Answer 1

An alpha of 0.05 means that there is a 5% chance that the null hypothesis is rejected when it is true. This means that Chris’s mother’s interpretation that an alpha level of 5% means you will commit errors 5% of the time is correct.

The advantages and disadvantages of doing what Chris’s mother suggests are:

The smaller the alpha level, the smaller the area where you would reject the null hypothesis. So if you have a tiny area, there’s more of a chance that you will NOT reject the null, when in fact you should. This is a Type II error.
In other words, the more you try and avoid a Type I error, the more likely a Type II error could creep in. Scientists have found that an alpha level of 5% is a good balance between these two issues.