SCENARIO 17-4 The Regression Tree Below Was Obtained for Predicting the Weekend

question 59

True/False

SCENARIO 17-4
The regression tree below was obtained for predicting the weekend box office revenue of a newly
released movie (in thousands of dollars)based on data collected in different cities on the expenditure
(at $25, $30, $35, $40, $45, $50, $55, $60, $65 or $70 thousand)spent on TV advertising and the
number of times (10, 15, 20, 25, 30 or 35)a day the advertisement appear on TV.
Business Analytics 17-15
-True or False: Referring to Scenario 17-4, the highest mean weekend box office revenue is
predicted to occur with less than $45 thousand spent on TV advertisement and fewer than 25
advertisement appearances a day.

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Definitions:

Compounded Monthly

A financial mechanism where interest earnings are recalculated each month, resulting in increased earnings over time due to the effect of compounding.

Withdrawals

The act of taking money out of an investment or bank account.

Fund Sustain

The capability to maintain financial resources at a certain level or to ensure the ongoing availability of funds.

Effective Interest Rate

The real cost of borrowing, reflecting the total amount of interest paid over the term of a loan, including the effect of compounding.