EXAMPLE 11.12 A Model for Predicting Movie Revenue

CASE 11.2 We want to investigate if a linear model that includes a movie’s budget, opening-weekend revenue, and opening-weekend theater count can forecast total U.S. box office revenue. This multiple regression model has explanatory variables: , , and . Each particular combination of budget, opening-weekend revenue, and opening-weekend theater count defines a particular subpopulation. Our response variable is the U.S. box office revenue as of 2014.

The multiple regression model for the subpopulation mean U.S. box office revenue is

For movies with $35 million budgets that earn $78.23 million in 3700 theaters their first weekend, the model gives the subpopulation mean U.S. box office revenue as