The output of a time series regression analysis using time

series data of last 15 years of earnings of the motion picture

industry measured in dollars per year are given. Use these results

to answer the following questions. How well do movie ticket sales

in December explain the level of earnings for the entire year?

Present statistical evidence to support your answer. Sales of movie

tickets in December are expected to be approximately 950,000.

According to this regression analysis, what do you expect earnings

for the year to be? Prior to this analysis, the estimates for

earnings in December are $48 million. Is this evidence strong

enough for you to consider improving the current recommendation for

the motion picture industry?

A security analyst specializing in the stocks of the motion

picture industry the relation between the number of movie theater

tickets sold in December and the annual level of earnings in the

motion picture industry.

Time-series data for the last 15 years are used to estimate the

regression model. E = a + bN where E is

total earnings of the motion picture industry measured in dollars

per year and N is the number of tickets sold in December. The

regression output is as follows:

DEPENDENT VARIABLE:

E

R-SQUARE

0. 8311

F-RATIO 63.96

P-VALUE ON

F 0.0001

OBSERVATIONS: 15

Coefficient Standard Error T-Ratio p-

value

Intercept 25042000.00 20131000.00 1.24 0.2369

N 32.31

8.54

3.78

0.0023

How well do movie ticket sales in December explain the level of

earnings for the entire year? Present statistical evidence to

support your answer. Also, sales of movie tickets in December are

expected to be approximately 950,000. According to this regression

analysis, what do you expect earnings for the year to be? Prior to

this analysis, the estimates for earnings in December are $48

million. Is this evidence strong enough for you to consider

improving the current recommendation for the motion picture

industry?