Balancing the Risks of Errors in Hypothesis Testing

The U.S. FDA is responsible for approving new drugs.Many consumer groups feel that the approval process is too easy and, therefore, too many drugs are approved that are later found to be unsafe.On the other hand, a number of industry lobbyists have pushed for a more lenient approval process so that pharmaceutical companies can get new drugs approved more easily and quickly. This is from an article in the Wall Street Journal.Consider a null hypothesis that a new, unapproved drug is unsafe and an alternative hypothesis that a new, unapproved drug is safe.

a) Explain the risks of committing a Type 1 or Type 2 error.

b)Which type of error is the consumer group trying to avoid?

c)Which type of error is the industry lobbyists trying to avoid?

d)How would it be possible to lower the chances of both Type 1 and 2 errors?

Think about the recent vaccinations developed for Covid in record time.Do you recall reading about the items above and are they important?