Golden rule entrepreneurship

The film entertainment industry believes that the total gross theater earnings from a film can be determined by looking at the opening gross box office receipts. Industry executives use the rule of thumb that for every dollar earned on opening day, three dollars will be earned in total from box office receipts (i.e., Total Gross = 3 x Open Gross). This is why they invest in all that marketing prior to opening day.

I decided to take a look at this rule of thumb, so I created an R script that pulled the required data from Box Office Mojo (see below). I grabbed all 14K+ films from BOM, did a bit of data cleaning and formatting, then plotted the relationship between Opening Box Office Receipts and Total Gross Theater Earning. As it turns out, the executives are right, the 2.5% to 97.5% confidence range for the golden ratio is 3.13 and 3.19, respectively. As a correlative predictive model, it is significant (R^2=.8034).  

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R-SCRIPT (based on Tony Breyal Quick Scrape script)

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