Which of the Following Is a Type I Error

question 6

Multiple Choice

Which of the following is a Type I error?

• A) the null hypothesis is actually true, and the hypothesis test correctly fails to reject it
• B) the null hypothesis is actually false, but the test incorrectly fails to reject it
• C) the null hypothesis is actually false, and the test correctly rejects it
• D) the null hypothesis is actually true, but the hypothesis test incorrectly rejects it

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Definitions:

AVC

Average Variable Cost, which is the total variable cost divided by the quantity of output produced. It represents the variable cost per unit of output.

MC

Marginal Cost, which refers to the increase in total production cost that arises from producing one additional unit of a good or service.

Economic Profit

The difference between total revenue and total costs, including both explicit and implicit costs like opportunity costs.

ATC

Stands for Average Total Cost, which is the total cost of production divided by the quantity of output produced.