In Problem, you used box office gross to predict DVD revenue (stored in Movie). Using the...

In Problem, you used box office gross to predict DVD revenue (stored in Movie). Using the results of that problem,

a. determine the coefficient of determination, r2, and interpret its meaning.

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b. determine the standard error of the estimate.

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c. How useful do you think this regression model is for predicting DVD revenue?

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d. Can you think of other variables that might explain the variation in DVD revenue?

Problem

A company that holds the DVD distribution rights to movies previously released only in theaters has the business objective of developing estimates of the sales revenue of DVDs. Toward this goal, a company analyst plans to use box office gross to predict DVD sales revenue. For 22 movies, the analyst collects the box office gross (in $millions) in the year that they were released and the DVD revenue (in $millions) in the following year. The data are shown below and stored in Movie.

Sources: Data extracted from www.the-numbers.com/market/movies2008.php; and www.the-numbers.com/dvd/charts/annual/2009.php.

For these data,

a. construct a scatter plot.

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b. assuming a linear relationship, use the least-squares method to determine the regression coefficients b0 and b1

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c. interpret the meaning of the slope, b1, in this problem.

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d. predict the sales revenue for a movie DVD that had a box office gross of $75 million.