Exemplar for the Required Problems from Chapter 13
for Homework #10
ASW 4e 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 x2 alone in a regression).
(This is asked
for part a of the problem.)
HW #4 / Chap 13 Exemplar
1
© 2010 Harvey Singer
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View Full DocumentA 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
where Y is the mean weekly gross revenue expected for a weekly newspaper
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 Spring '08
 SINGER
 Regression Analysis, weekly gross revenue, TV Advertising, gross revenue

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