Question

2. A recent article discussed the worst remake movies in terms of the reduction in movie sales for the remake relative to the original. The three worst remake movies, their sales, and the year in which those sales took place are given in the following table. All figures are in millions. Amityville Horror Poseidon Adventure Remake Original 2005 1979 $65.2 $86.4 2006 1972 $60.7 $93.3 2011 1981 $33.0 $95.5 2016 1959 $26.4 $74.7 Arthur Ben Hur CPI Unfortunately, these figures are in nominal terms. To do the comparison correctly, the calculation must be made in real, or inflation adjusted, terms. To facilitate that comparison you are given the following CPI data. Year 1959 1972 1979 1981 1982 2005 2006 Given this data, which one of the remakes actually had the worst performance? 29.1 41.8 72.6 90.9 96.5 195.3 201.6 2249 233.0 240.0 2011 How much less, in 2016 dollars, did the worst remake earn compared to the original movie? 2013 2016

Answer 1

Amityville horror

The original is made in Year 1979 and earned $86.4 million.

The remake is made in Year 2005 and earned $65.2 million.

Converting the earning made by original in 1979 in 2005 dollars -

Earning in 2005 dollars = Earning in 1979 * [CPI in 2005/CPI in 1979]

Earning in 2005 dollars = $86.4 million * [195.3/72.6] = $232.42 million

The earning made by the Amityville horror original in 2005 dollars is $232.42 million.

Difference in earning = Earning of original in 2005 dollars - Earning of remake in 2005

Difference in earning = $232.42 million - $65.2 million = $167.22 million

The difference in earning of original and remake of Amityville Horror is $167.22 million.

Poseidon Adventure

The original is made in Year 1972 and earned $93.3 million.

The remake is made in Year 2006 and earned $60.7 million.

Converting the earning made by original in 1972 in 2006 dollars -

Earning in 2006 dollars = Earning in 1972 * [CPI in 2006/CPI in 1972]

Earning in 2006 dollars = $93.3 million * [201.6/41.8] = $449.98 million

The earning made by the Poseidon Adventure original in 2006 dollars is $449.98 million.

Difference in earning = Earning of original in 2006 dollars - Earning of remake in 2006

Difference in earning = $449.98 million - $60.7 million = $389.28 million

The difference in earning of original and remake of Poseidon Adventure is $389.28 million.

Arthur

The original is made in Year 1981 and earned $95.5 million.

The remake is made in Year 2011 and earned $33.0 million.

Converting the earning made by original in 1981 in 2011 dollars -

Earning in 2011 dollars = Earning in 1981 * [CPI in 2011/CPI in 1981]

Earning in 2011 dollars = $95.5 million * [224.9/90.9] = $236.28 million

The earning made by the Arthur original in 2011 dollars is $236.28 million.

Difference in earning = Earning of original in 2011 dollars - Earning of remake in 2011

Difference in earning = $236.28 million - $33.0 million = $203.28 million

The difference in earning of original and remake of Arthur is $203.28 million.

Ben Hur

The original is made in Year 1959 ad earned $74.4 million.

The remake is made in Year 2016 and earned $26.4 million.

Converting the earning made by original in 1959 in 2016 dollars -

Earning in 2016 dollars = Earning in 1959 * [CPI in 2016/CPI in 1959]

Earning in 2016 dollars = $74.4 million * [240/29.1] = $613.61 million

The earning made by the Ben Hur original in 2016 dollars is $613.61 million.

Difference in earning = Earning of original in 2016 dollars - Earning of remake in 2016

Difference in earning = $613.61 million - $26.4 million = $587.21 million

The difference in earning of original and remake of Ben Hur is $587.21 million.

Thus,

The remake that actually had the worst performance is Ben Hur.

The worst remake earned $587.21 million less, in 2016 dollars, compared to the original movie.