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. Newspaper Weekly Gross Revenue ($1,000s) Television Advertising ($1,000s) 5.0 Advertising ($1,000s) 1.5 л 2.0 o 2.0 4.0 o 1.5 92 2.5 2.5 . 102 3.0 3.3 94 3.5 2.3 94 2.5 м 95 3.0 2.5

Answer 1

Ans a )  using excel >stat>basic stat>regression

SUMMARY OUTPUT
Regression Statistics
Multiple R	0.506916
R Square	0.256964
Adjusted R Square	0.133124
Standard Error	3.411877
Observations	8
ANOVA
	df	SS	MS	F	Significance F
Regression	1	24.15459	24.15459	2.074976	0.199805
Residual	6	69.84541	11.6409
Total	7	94
	Coefficients	Standard Error	t Stat	P-value	Lower 95%	Upper 95%
Intercept	88.84058	4.44285	19.9963	1.02E-06	77.96932	99.71184
TV add	1.932367	1.341477	1.440478	0.199805	-1.35011	5.214842

Revenue = 88.8 + 1.9 TV add

b )

SUMMARY OUTPUT
Regression Statistics
Multiple R	0.729612
R Square	0.532334
Adjusted R Square	0.345267
Standard Error	2.965152
Observations	8
ANOVA
	df	SS	MS	F	Significance F
Regression	2	50.03937	25.01969	2.845692	0.149568
Residual	5	43.96063	8.792126
Total	7	94
	Coefficients	Standard Error	t Stat	P-value	Lower 95%	Upper 95%
Intercept	78.28648	7.262454	10.77962	0.000119	59.61775	96.95521
TV add	3.27187	1.403074	2.331929	0.06705	-0.33485	6.878586
News Add	2.539167	1.479844	1.715834	0.146849	-1.26489	6.343227

Revenue = 78.29 + 3.27 TV add + 2.54 News Add

ans 3 ) No, the coefficient for television advertising expenditure is not same.

Ans 4) For tv add = $ 3.5 , News Add = 1.8

predicted Revenue = 78.29 + 3.27*3.5 + 2.54 *1.8 = 94.31