If a test of hypothesis has a Type I error probability of 0.01, it means that
A)if the null hypothesis is true, you don't reject it 1% of the time.
B)if the null hypothesis is true, you reject it 1% of the time.
C)if the null hypothesis is false, you don't reject it 1% of the time.
D)if the null hypothesis is false, you reject it 1% of the time.

Question

If a test of hypothesis has a Type I error probability  of 0.01, it means that
A)if the null hypothesis is true, you don't reject it 1% of the time. 
B)if the null hypothesis is true, you reject it 1% of the time. 
C)if the null hypothesis is false, you don't reject it 1% of the time. 
D)if the null hypothesis is false, you reject it 1% of the time.

Quizplus · Accepted Answer

The probability of Type I error is the probability of rejecting the null hypothesis when it is actually true. Therefore, if the Type I error probability is 0.01, it means that if the null hypothesis is true, we reject it 1% of the time. A Type I error occurs when the null hypothesis is actually true but we reject it based on the sample evidence. The probability of making a Type I error is the significance level, which is given in the question as 0.01. Therefore, if the null hypothesis is true, we reject it 1% of the time.

If a Test of Hypothesis Has a Type I Error