If we want a precise estimation of, for example, type I error rate, a sufficent number of simulation repitions is needed. Assume each simulation repition is a Bernoulli trial with rate, \(p\), and there are \(n\) trails correponding to \(n\) simulation repitions. In the end, we count the number of false positives, and this count follows Binomial distribution, \(Binom(n,p)\).
\begin{align*} \hat{p} &= \frac{\sum X_i}{n}\\ CI_{\hat{p}} &= \hat{p} \pm Z_{\alpha/2}SE(\hat{p})\\ CI_{\hat{p}} &= \hat{p} \pm 1.96 \sqrt{\frac{p(1-p)}{n}} \end{align*} If I want a confidence interval with width smaller than 1%, then: \begin{align*} 1.96 \sqrt{ \frac{p(1-p)}{n} } < 0.005 \\ n > 7,300 \text{, if } p = 0.05 \\ n > 24,587 \text{, if } p = 0.8 \end{align*}