# Multiple regression analysis problem | Numerical analysis homework help

MULTIPLE REGRESSION ANALYSIS

A motion picture industry analyst wants to estimate the gross earnings generated by a movie. The estimate will be based on different variables involved in the film’s production. The independent variables considered are X1 (COST) = production cost of the movie and X2 (PROM) = total costs of all promotional activities. A third variable that the analyst wants to consider is the qualitative variable of whether or not the movie is based on a book published before the release of the movie. This third qualitative variable is handled by the use of an indicator variable: X3 (BOOK) =1 if the movie is based on a book and 0 otherwise. The analyst obtains information on a random sample of 20 Hollywood movies made within the last five years. Data is give. The variable Y (EARN) is gross earnings, in millions of dollars. The two quantitative independent variables are also in millions of dollars.

Data given as under:

 EARN COST PROM BOOK 28 4.2 1 0 35 6 3 1 50 5.5 6 1 20 3.3 1 0 75 12.5 11 1 60 9.6 8 1 15 2.5 0.5 0 45 10.8 5 0 50 8.4 3 1 34 6.6 2 0 48 10.7 1 1 82 11 15 1 24 3.5 4 0 50 6.9 10 0 58 7.8 9 1 63 10.1 10 0 30 5 1 1 37 7.5 5 0 45 6.4 8 1 72 10 12 1

The applicable general regression model as given in the question is as under:

Predicted EARNings = a + b1*COST + b2*PROM + b3*BOOK + error term

As per the data fitted regression line is given as follows:

Y Hat (EARN) = 7.8362+ 2.8477 * COST + 2.2782 * PROM + 7.1661 * BOOK + 3.6895

a)      How useful is the model overall?

b)      Are all three independent variables relevant?

c)       What gross earning does the model predict for a movie costing nothing to produce or promote, and that is not based on a book? How meaningful is this figure?

d)      Explain the meaning of the estimate b1=2.85?

e)      Can you reject the hypothesis that the underlying value of b1 =1?

f)       What would this hypothesis imply?

g)      Compare the estimated gross earnings of a movie costing \$6m, with promotion cost of \$3m based on a book, to that of a movie with identical costs, but not based on a book. Explain the meaning of b3?

h)      An author’s association claims that the existence of a book increases gross earnings on average by at least \$7.5m. Can you reject this hypothesis?

Calculate your paper price
Pages (550 words)
Approximate price: -

Why Work with Us

Top Quality and Well-Researched Papers

We always make sure that writers follow all your instructions precisely. You can choose your academic level: high school, college/university or professional, and we will assign a writer who has a respective degree.

Professional and Experienced Academic Writers

We have a team of professional writers with experience in academic and business writing. Many are native speakers and able to perform any task for which you need help.

Free Unlimited Revisions

If you think we missed something, send your order for a free revision. You have 10 days to submit the order for review after you have received the final document. You can do this yourself after logging into your personal account or by contacting our support.

Prompt Delivery and 100% Money-Back-Guarantee

All papers are always delivered on time. In case we need more time to master your paper, we may contact you regarding the deadline extension. In case you cannot provide us with more time, a 100% refund is guaranteed.

Original & Confidential

We use several writing tools checks to ensure that all documents you receive are free from plagiarism. Our editors carefully review all quotations in the text. We also promise maximum confidentiality in all of our services.

Our support agents are available 24 hours a day 7 days a week and committed to providing you with the best customer experience. Get in touch whenever you need any assistance.

Try it now!

## Calculate the price of your order

Total price:
\$0.00

How it works?

Follow these simple steps to get your paper done

Fill in the order form and provide all details of your assignment.

Proceed with the payment

Choose the payment system that suits you most.

Receive the final file

Once your paper is ready, we will email it to you.

Our Services

No need to work on your paper at night. Sleep tight, we will cover your back. We offer all kinds of writing services.

## Essay Writing Service

No matter what kind of academic paper you need and how urgent you need it, you are welcome to choose your academic level and the type of your paper at an affordable price. We take care of all your paper needs and give a 24/7 customer care support system.