Python Data - Assignment 2 Questions

Question 2 (6 marks)

Use the file movies.xlsx to answer this question. The file contains information of 190 movies, including two variables: Gross (Gross Revenue) and Budget (Spending), both are in millions (USD).

1. Classify movies into two groups: money-making (Gross >= Budget) and money-losing (Gross < Budget). Test if the following claim is true: "more movies are money-losing than money-making." Use the 6 steps of hypothesis testing to report the testing outcomes.
2. Estimate a simple linear regression model of 'Gross' on 'Budget'. Interpret the estimation outcomes (in terms of parameter significance, fitness, and the meaning of the regression slope & intercept).
3. Make a scatterplot of Gross on Budget and identify a clear outlier from the plot (find the outlier movie). Estimate a simple regression as in Part 2 but without the outlier. Compare and comment on the regression results with and without the outlier.