The document discusses two types of tests: norm-referenced tests (NRTs) and criterion-referenced tests (CRTs). NRTs measure global language abilities and compare student performance to others, following a normal distribution. CRTs measure specific instructional objectives and compare student performance to a set criterion or standard. The key differences between the tests are that NRTs use relative interpretation to compare students, measure general proficiency, and aim to rank students, while CRTs use absolute interpretation to measure objective-based learning, specific content mastery, and assess learning against a set standard.