2. Pharmaceutical companies spend billions of dollars per year on research and development of new drugs. The pharmaceutical company must subject each new drug to lengthy and involved testing before receiving the necessary permission from the Food and Drug Administration (FDA) to market the drug. The FDA's policy is that the phar- maceutical company must provide substantial evidence that a new drug is safe prior to receiving FDA approval, so that the FDA can confidently certify the safety of the drug to potential consumers. (a) If the new drug testing were to be placed in a test of hypothesis framework, would the null hypothesis be that the drug is safe or unsafe? The alternative hypothesis? (In an actual test, "safety" could be quantified using population parameters; Problem 7 is a conceptual exercise.) Fill in the blanks below. and the alternative hypothesis would The null hypothesis would be that the drug is be that the drug is (b) Given the choice of null and alternative hypotheses in part (a), describe the Type I and Type II errors in terms of this application. Define a and 3 in terms of this application. Fill in the blanks below. The Type I error for this problem would be to conclude that the drug is is actually when the drug The Type II error for this problem would be to conclude that the drug is when the drug is actually -- In this application a is the probability of concluding that a drug it when the drug actually and 3 is the probability of concluding that a drug safe. safe when actually safe