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A parachute packing company claims that no more than one of their main parachutes fail per month, on average. We want to run
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Answer #1

Type I error is rejecting the null hypothesis when it is true.

In this case, Type I error will occur when we conclude that the mean number of parachutes fail per month is more than one, whereas actually it is not more than one.

Also, the consequence of committing Type I error in case is that the conclusion will be that mean number of parachutes fail per month is more than one, which will lead to loss of image for the company. It might effect the company business and the company need to take precautionary steps whereas ideally it should not have taken any steps. It might also result in finacial losses and lack of optimization for the company.

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