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MathClass of Sep 25, 2026
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Hypothesis Testing: Choosing the Cutoff

In class we used the simulation method: reject the hypothesis if a result as extreme as yours shows up in about 5% or less of the simulated samples. If your teacher uses a different cutoff, go with your teacher’s.


What the cutoff is called

In statistics, that 5% cutoff is called the significance level, written α = 0.05 (α is the Greek letter “alpha”).

The claim you are testing (e.g. “the coin is fair”) is called the null hypothesis.

How the decision changes with the cutoff

Teacher’s cutoff Reject the null hypothesis if the result shows up in… What it means
1% (α = 0.01) 1% or less of the simulated samples Stricter: needs stronger evidence to reject
5% (α = 0.05) 5% or less of the simulated samples The usual standard
10% (α = 0.10) 10% or less of the simulated samples More lenient: easier to reject

The core decision rule (the same for every cutoff)

If  P(simulated outcome ≥ observed outcome)  ≤  teacher’s cutoff
    →  Reject the null hypothesis.

Otherwise  →  Do not reject it. The data doesn’t give enough evidence against the claim, but that does not prove the claim is true.

Quick check with our coin examples