Hypothesis Testing (Two Tailed Test)

Two Tailed Test

H₁: parameter not equal value
Another way to write not equal is < or >
Notice the inequality points to both sides
Decision Rule: Reject H₀ if t.s. < c.v. (left) or t.s. > c.v. (right)

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The decision rule can be summarized as follows:
Reject H₀ if the test statistic falls in the critical region
(Reject H₀ if the test statistic is more extreme than the critical value)