1. The owner of Showtime Movie Theaters, Inc., would like to estimate weekly gro
ID: 3360793 • Letter: 1
Question
1. The owner of Showtime Movie Theaters, Inc., would like to estimate weekly gross revenue as a function of advertising expenditures. Historical data for a sample of eight weeks follow.
Television Advertising ($1000s)
Newspaper Advertising ($1000s)
Weekly Revenue ($1000s)
3
3.3
98
3.5
2.3
97
2.5
4.2
97
5
1.5
99
2
2
93
4
1.5
98
2.5
2.5
95
Write down what the estimated regression equation is that relates weekly revenue equation with both television advertising and newspaper advertising as the independent variables.
Interpret the slope coefficients for each of the independent variables.
Complete the ANOVA Table
Conduct Hypothesis tests on Regression and Individual coefficients at 0.05 level of significance.
What are the values of Coefficient of Multiple Determination and Adjusted Coefficient of Multiple Determination?
Comment on Goodness of Fit between the dependent variable and the two independent variables.
How are R-Sq and R-Sq (adj) calculated?
What is the gross revenue expected for a week when $3500 is spent on television advertising and $1800 is spent on newspaper advertising?
Television Advertising ($1000s)
Newspaper Advertising ($1000s)
Weekly Revenue ($1000s)
3
3.3
98
3.5
2.3
97
2.5
4.2
97
5
1.5
99
2
2
93
4
1.5
98
2.5
2.5
95
Write down what the estimated regression equation is that relates weekly revenue equation with both television advertising and newspaper advertising as the independent variables.
Interpret the slope coefficients for each of the independent variables.
Complete the ANOVA Table
Conduct Hypothesis tests on Regression and Individual coefficients at 0.05 level of significance.
What are the values of Coefficient of Multiple Determination and Adjusted Coefficient of Multiple Determination?
Comment on Goodness of Fit between the dependent variable and the two independent variables.
How are R-Sq and R-Sq (adj) calculated?
What is the gross revenue expected for a week when $3500 is spent on television advertising and $1800 is spent on newspaper advertising?
Explanation / Answer
Write down what the estimated regression equation is that relates weekly revenue equation with both television advertising and newspaper advertising as the independent variables
Using Excel data analysis:
The regression equation is
Y^=86.0111+2.3190TV+1.3147News paper
What is the gross revenue expected for a week when $3500 is spent on television advertising and $1800 is spent on newspaper advertising?
Y^=86.0111+2.3190TV+1.3147News paper
Y^=86.0111+2.3190(3500)+1.3147(1800)
=10568.9711
What are the values of Coefficient of Multiple Determination and Adjusted Coefficient of Multiple Determination?
Coefficient of Multiple Determination is 0.9377
Adjusted Coefficient of Multiple Determination is 0.9066
Television Advertising ($1000s)(X1) Newspaper Advertising ($1000s)(X2) Weekly Revenue ($1000s)(Y) 3 3.3 98 3.5 2.3 97 2.5 4.2 97 5 1.5 99 2 2 93 4 1.5 98 2.5 2.5 95Related Questions
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