In answering the following exercises, it will be helpful to have before you the definitions of Type I and Type II errors that you have already learned. Here is a reminder:

Type I: There really is not an effect (population truth), but you find one (your decision) in your study.

Type II: There really is an effect (population truth), but you don’t find one (your decision) in your study.

Stan applied to work at Great Company. Because Stan had a degree from a prestigious university, the company expected him to be a great employee. Given their expectation (i.e., given what they thought was the population truth regarding applicants from prestigious universities), managers at Great Company hired Stan. However, Stan turned out to be a very unproductive worker, and Great Company ended up firing him. What type of error did Great Company make in its initial decision to hire Stan—was it Type I or Type II? Explain your answer.