The error occurs because one of your fields is string and you are comparing it to a number. I won't know the offending fields except I see a sample workbook.
However, you can try the code below to see if it resolves the problem.
Create calculated field called [Incident SLA Response Status]
IF INT( [RESPONSE SLA]) <= 1 and INT([Incident Priority]) = 1 then 'Achieved'
ELSE 'Breached' END
Hope this helps.