Type I and II Error Analysis for Product Selection
Check out this segment from Dr. David Galligan from the University of Pennsylvania as he takes a look at Type I vs. Type II errors for product selection, and why product selection should be viewed as an investment opportunity.
What you will learn?
- Products vary in their response attributes
- The value of a product is not only a function of its mean response, but also influenced by its risk characteristics
- If a product has a Type II error > its Type I error, the product should be used since the expected cost of the product failing is less than the lost opportunity cost of it succeeding
Dr. David Galligan, University of Pennsylvania
Dr. David Galligan is Professor of Animal Health Economics at the University of Pennsylvania School of Veterinary Medicine. As Director of Penn Vet's Center for Animal Health and Productivity, Dr. Galligan has extensive experience in production agriculture. He received his BA in Biology from the University of Pennsylvania (1976), VMD from the University of Pennsylvania School (1981) and his MBA in Decision Sciences from Wharton (1985). Since joining the faculty at Penn Vet, Dr. Galligan has conducted extensive research in animal health economics and on optimizing on farm decision making. His primary area of interest is in identifying and formulating wealth creation strategies for animal production systems. He is actively involved in the creation of web based tools to visualize complex problems in animal agriculture. He is currently teaching animal health economics to veterinary students and helps to coordinate courses in global food security.