QUESTION 1: What is the importance of a 5% significance level? Why would you choose 5% as opposed to 10% or 1%? What effect does the level of significance have on a Type II error? Please give examples of business situations that would call for different levels of significance.
QUESTION 2: What is the difference between a left-tailed, two-tailed, and right-tailed test. When would you choose a one-tailed test? How can you determine the direction of the test by looking at a pair of hypotheses? How can you tell which direction (or no direction) to make the hypothesis by looking at the problem statement (research question)?
These do not have to be in essay format, it is a simple minimum of 150 word response.