ABSTRACT
The theory of hypothesis testing is concerned with the problem: 'Is a given observation consistent with some stated hypothesis or is it not?' A statistical test of a hypothesis is a rule which assigns each possible observation to one of two exclusive categories: 'consistent with the hypothesis under consideration' and 'not consistent with this hypothesis'. In order to build up a theory of hypothesis testing and establish methods which can be applied in situations which are too complicated to be dealt with on an intuitive basis, it is necessary to analyse the intuitive reasoning which leads to 'reasonable' rests for simple situations. A hypothesis which specifies a set in the parameter space containing only one element is called a simple hypothesis.
