Question

Can you use Twitter activity to forecast box office receipts on the opening weekend? The following data (stored in Twitter Movies ) indicate the Twitter activity (“ want to see”) and the receipts ($) per theater on the weekend a movie opened for seven movies:
a. Use the least squares method to compute the regression coefficients b0 and b1.
b. Interpret the meaning of b0 and b1 in this problem.
c. Predict the mean receipts for a movie that has a Twitter activity of 100,000.
d. Should you use the model to predict the receipts for a movie that has a Twitter activity of 1,000,000? Why or why not?
e. Determine the coefficient of determination, r2, and explain its meaning in this problem.
f. Perform a residual analysis. Is there any evidence of a pattern in the residuals? Explain.
g. At the 0.05 level of significance, is there evidence of a linear relationship between Twitter activity and receipts?
h. Construct a 95% confidence interval estimate of the mean receipts for a movie that has a Twitter activity of 100,000 and a 95% prediction interval of the receipts for a single movie that has a Twitter activity of 100,000.
i. Based on the results of (a)–(h), do you think that Twitter activity is a useful predictor of receipts on the first weekend a movie opens? What issues about these data might make you hesitant to use Twitter activity to predict receipts?


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  • CreatedJuly 16, 2015
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