response variable and explanatory variable? This example relates to the percentage of expenditure, P, a publishing house spends on advertising and the change in revenue, R (expressed as a percentage) at the end of the following year. What is the response variable and what is the explanatory variable? Am I correct in saying the explanatory variable is P and responce is R?

Seems right to me, since you can control the spending on advertising and learn how the revenue responds to it, rather than controlling the revenue and see how it effects your spending on advertising.