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The owner of Showtime Movie Theaters, Inc., used multiple regression analysis to predict gross revenue () as a function of television advertising () and newspaper advertising ().

Weekly Gross Revenue
($1000s) Televison Advertising
($1000s) Newspaper Advertising
($1000s)
96 5 1.5
90 2 2
95 4 1.5
92 2.5 2.5
95 3 3.3
94 3.5 2.3
94 2.5 4.2
94 3 2.5

The estimated regression equation was .
The computer solution provided .
a. Compute (to 3 decimals).

1 Answer

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The estimated gross revenue for next week is $94,000. We are 95% confident that it will be between $93,500 and $94,440.

The estimated gross revenue for next week is $93,997. The 95% prediction interval is (93,500, 94,440). This means that we are 95% confident that the actual gross revenue will be between $93,500 and $94,440.

The estimated regression equation is 83.23 + 2.29x1 + 1.30x2, where x1 is the amount spent on television advertising and x2 is the amount spent on newspaper advertising. Both television and newspaper advertising have a positive effect on gross revenue.

This means that for every $1,000 increase in television advertising, we expect gross revenue to increase by $2,291. For every $1,000 increase in newspaper advertising, we expect gross revenue to increase by $1,302.

The R-squared value is 0.827, which means that 82.7% of the variation in gross revenue can be explained by the variation in television and newspaper advertising. The adjusted R-squared value is 0.784, which takes into account the number of independent variables in the model.

Overall, the multiple regression model seems to be a good fit for the data. The estimated coefficients are statistically significant and the R-squared values are relatively high. This suggests that the model can be used to make reliable predictions about gross revenue based on television and newspaper advertising expenditures.

The owner of Showtime Movie Theaters, Inc., used multiple regression analysis to predict-example-1
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