Q1. An advertising company collected information from 10Hollywood Movies, including the number of the first year box officereciepts ad the total promotional costs for each movies. They wishto study the relationship between promotion cost and the box officereciepts.
First year box office reciepts (millions) 85.1 106.3 50.2 130.654.8 30.3 79.4 91.0 135.4 89.3
Total promotional costs (millions) 5.10 5.80 2.10 8.40 2.90 1.203.70 7.60 7.70 4.50
a. If we would like to use the promotion cost to predict the boxoffice reciepts, could you implement a simple regression model?Please use the matrix approach to estimate the reregressioncoefficients. Report your residual vector e, SSTO, SSR,SSE.
b. check the model assumption of residual assumptions. List allthe assumptions made here and use graphs or tests to evaluate atleast two of them. Report your R code/ output and yourconclusions.
