A Financier Whose Specialty Is Investing in Movie Productions Has

question 43

Essay

A financier whose specialty is investing in movie productions has observed that, in general, movies with 'big-name' stars seem to generate more revenue than those movies whose stars are less well known. To examine his belief, he records the gross revenue and the payment (in $ million) given to the two highest-paid performers in the movie for 10 recently released movies. $$\begin{array} { | c | c | c | } \hline \text { Movie } & \begin{array} { c } \text { Cost of two highest- } \\\text { paid performers } ( \$ \mathrm {~m} )\end{array} & \begin{array} { c } \text { Gross revenue } \\( \$ \mathrm {~m} )\end{array} \\\hline 1 & 5.3 & 48 \\\hline 2 & 7.2 & 65 \\\hline 3 & 1.3 & 18 \\\hline 4 & 1.8 & 20 \\\hline 5 & 3.5 & 31 \\\hline 6 & 2.6 & 26 \\\hline 7 & 8.0 & 73 \\\hline 8 & 2.4 & 23 \\\hline 9 & 4.5 & 39 \\\hline 10 & 6.7 & 58 \\\hline\end{array}$$ a. Determine the least squares regression line.
b. Interpret the value of the slope of the regression line.
c. Determine the standard error of estimate, and describe what this statistic tells you about the regression line.

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Definitions:

Alternating Current

The form in which electrical current is generated at power stations and transmitted along power lines to customers. Alternating current is created by causing electrons to flow in an alternating positive and negative manner.

AC Generator

A machine that converts mechanical energy into alternating current electrical energy.

DC Motor

An electric motor that runs on direct current electricity, widely used in various applications due to its simplicity and ease of control.

Magnetic Fields

Invisible fields produced by electrically charged objects, affecting the behavior of charged objects in the vicinity.