If a kid throws a tantrum in the grocery store cause they want candy, would you buy them candy? If you do, you’re teaching them that tantrum = candy. If you don’t ever buy them candy if they tantrum, that’s extinction! If you sometimes buy them candy but only when they DON’T tantrum and ask nicely, that’s reinforcing alternative behavior.

Let me preface by saying, this is not the "extinction" being talked about.

Think about your comparison. Your example is candy, and whether or not the kid gets it.

Sleep training "extinction" is ignoring your child crying for anywhere between 1 and 720 minutes at a time.

A better analogy would be letting your kid wail in the store about candy for multiple hours, while standing there and ignoring that behaviour entirely, for as long as it takes for them to stop, or for the store to close.

Anyway, good luck with the exam, but the term you're referring to was appropriated for a different function.