Use computer software packages, such as Minitab or Excel, to solve this problem.
ID: 3156565 • Letter: U
Question
Use computer software packages, such as Minitab or Excel, to solve this problem. The owner of Showtime Movie Theaters, Inc., would like to predict weekly gross revenue as a function of advertising expenditures. Historical data for a sample of eight weeks follow.
Develop an estimated regression equation with the amount of television advertising as the independent variable (to 1 decimal).
Revenue = + TVAdv
Develop an estimated regression equation with both television advertising and newspaper advertising as the independent variables (to 2 decimals).
Revenue = + TVAdv + NewsAdv
Predict weekly gross revenue for a week when $3.2 thousand is spent on television advertising and $2 thousand is spent on newspaper advertising?
$ in thousands
Explanation / Answer
Develop an estimated regression equation with the amount of television advertising as the independent variable (to 1 decimal).
Regression Analysis: Weekly gross versus Television advertising
The regression equation is
Weekly gross = 90.7 + 1.5 * Television advertising
Predictor Coef SE Coef T P
Constant 90.696 5.998 15.12 0.000
Televisi 1.507 1.811 0.83 0.437
S = 4.606 R-Sq = 10.3% R-Sq(adj) = 0.0%
Analysis of Variance
Source DF SS MS F P
Regression 1 14.70 14.70 0.69 0.437
Residual Error 6 127.30 21.22
Total 7 142.00
Unusual Observations
Obs Televisi Weekly g Fit SE Fit Residual St Resid
8 3.00 105.00 95.22 1.66 9.78 2.28R
R denotes an observation with a large standardized residual
Develop an estimated regression equation with both television advertising and newspaper advertising as the independent variables (to 2 decimals).
Regression Analysis: Weekly gross versus Television a, Newspaper ad
The regression equation is
Weekly gross = 84.6 + 2.28 Television advertising + 1.46 * Newspaper advertising
Predictor Coef SE Coef T P
Constant 84.65 11.94 7.09 0.001
Televisi 2.275 2.307 0.99 0.369
Newspape 1.455 2.433 0.60 0.576
S = 4.874 R-Sq = 16.3% R-Sq(adj) = 0.0%
Analysis of Variance
Source DF SS MS F P
Regression 2 23.20 11.60 0.49 0.640
Residual Error 5 118.80 23.76
Total 7 142.00
Source DF Seq SS
Televisi 1 14.70
Newspape 1 8.51
Unusual Observations
Obs Televisi Weekly g Fit SE Fit Residual St Resid
8 3.00 105.00 95.11 1.77 9.89 2.18R
R denotes an observation with a large standardized residual
Predict weekly gross revenue for a week when $3.2 thousand is spent on television advertising and $2 thousand is spent on newspaper advertising?
Weekly gross = 84.6 + 2.28 Television advertising + 1.46 * Newspaper advertising
Weekly gross = 84.6 + 2.28*3.2 + 1.46*2
Predicted Weekly gross = $94.816 thousand
( Answers By using Minitab)
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