Prob 13.5 - ASW 5e Prob 13.5 (p. 541) The purpose of...

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ASW 5e Prob 13.5 (p. 541) The purpose of advertising is to get the message out to consumers to stimulate demand, thereby increasing revenue (as you have learned or will learn in your marketing class). Therefore, weekly gross revenue depends on and responds to the advertising budget, making it the dependent variable y (reported in units of $K). The advertising budget is split between TV and newspapers. The amount of money spent weekly on TV advertising is the independent variable x1 (reported in units of $K). The amount of money spent weekly on newspaper advertising is the independent variable x2 (reported in units of $K). The data and regression report is contained in the Excel workbook “ASW Prob 13.5.xls” which is companion to this document. The data is displayed in the table below. Weekly Gross Revenue ($K), y Television Advertising ($K), x1 Newspaper Advertising ($K), x2 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 A simple linear regression of y on just x1 (weekly TV advertising budget) alone as the independent variable results in the equation Y = 1.6039x1 + 88.638 where Y is the mean weekly gross revenue expected for a weekly TV advertising budget of x1 (both in $K); R^2 = 0.6526 (from the graph) and the adjusted R^2 = 0.5946 (from the output report using just x1 alone in a regression). (This is asked for part a of the problem.) A simple linear regression of y on just x2 (weekly newspaper advertising budget) alone as the independent variable results in the equation Y = -0.043x2 + 93.856 ASW 5e Prob 13.5 (p. 541) 1 © 2008 Harvey Singer
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Prob 13.5 - ASW 5e Prob 13.5 (p. 541) The purpose of...

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