Questions Type Your Name Here, Last Name First Forecasting C

Questions Type your name here, Last Name Firstforecasting Concepts Exer

Questions Type your name here, Last Name First Forecasting Concepts Exercises 28.1. The State of Arizona has asked you to examine tax burdens for residents in preparation for the next forecasting effort. Use the data in Table 28.3. (a) Prepare a graph showing the total state and local per capita taxes paid per year. Identify any outliers. (b) Calculate the level, trend and growth, and their averages. Table 28.5 State of Arizona: State and Local Per Capital Taxes Year Total State and Local Per Capita Taxes Paid ($) ...................................2. In the Arizona tax information in assignment 1, a typographical error in the data has been discovered. The tax per capita in 2006 was actually $6,368.10 rather than $3,368.10. (a) Prepare a graph showing the total state and local per capita taxes paid per year. Identify any outliers. (b) Using the Windsorizing technique, adjust the data and prepare a graph showing the original information and the adjusted information. 28.3. Northland is developing a forecast for its special revenue fund that does not conform to a trend. Use the data in Table 28.4 to calculate a 5-year moving average and then use that result to project revenues for this fund for the next 3 years. Year ...................4. Prepare a memo to the budget director of Northland providing a brief explanation of the revenue forecasts developed for FY 2014 to FY 2016. Based on the results of assignment 3, provide a recommendation. 28.5. River County receives revenue through property taxes. The budget director has asked you to build a forecast for the next 3 years. Use the data in Table 28.5. (a) Prepare a forecast using a 7-, 5-, and 3-year offset moving average of level and trend. (b) Utilize an analysis of errors to determine which forecast provides the most accurate information. Fiscal Year Table 28.5 River County: Property Tax Revenue (in thousands) ,762.,354.,971.,010.,382.,211.,407.,930.,246.,342.,042.,322.,165.,550.,733.,096.,422.,674.,996.,019.,401.,584.,842.99 Type your name here, Last Name First Please enter your name on the first page Put Graph answers here This page for graphs only. Other pages are self-checking Year Total State and Local Per Capita Taxes Paid .1 Graph for Exercise ........09 Put Graph Exercise 1 Here ........................35 Exercise 28.1 To show the cell checking, put a check here: x Percent Correct 0% Grade Graph 1 Exercise 28.1 Arizona Years of Data: to 2010 Year Total State and Local Per Capita Taxes Paid Level Trend Growth Check Grade .................................

Average Exercise 28.2 To show the cell checking, put a check here: x Grade Graph 2 Percent Correct 0% Please enter your name on the first page Grade in Points (All Sheets) 0.00 Exercise 28.2: Arizona 1977 to 2010 Year Total State and Local Per Capita Taxes Paid Winsorizing Check Grade ................................. Average 0 Standard Deviation Winsorizing Exercise 28.3 & 28.4 To show the cell checking, put a check here: x Percent Correct 0% Please enter your name on the first page Grade Graph 3 Grade in Points (All Sheets) 0.00 Exercise 28.3: Year Special Revenue 5yrMA Forecast based on 5YrMA Grade .1 Check ........... Exercise 28.4: Put Text Answer here Grade Text Answer Exercise 28.5 To show the cell checking, put a check here: x ME RMSE Percent Correct 0% Please enter your name on the first page MA3 Grade in Points (All Sheets) 0.00 MA5 Exercise 28.5 MA7 How many times the trend?

4 How many times the trend? 3 How many times the trend? ME MSE ME MSE ME MSE RMSE RMSE RMSE Property Tax Levy Property Tax Levy Property Tax Levy Fiscal Year Tax Levy Tax Levy Trend 7 year offset Level Offset Trend Forecast Error Error Sq Fiscal Year Tax Levy Tax Levy Trend 5 year offset Level Offset Trend Forecast Error Error Sq Fiscal Year Tax Levy Tax Levy Trend 3 year offset Level Offset Trend Forecast Error Error Sq ..................................................................... Check Grade Answer 1 Exercise xx-1 Arizona Years of Data: to 2010 Year Total State and Local Per Capita Taxes Paid Level Trend Growth .....96 0....36 0....76 0....33 0....5 0....43 0....55 0....1 0...5 98.41 0....35 0....1 0....18 0....86 0....56 0...01 7.46 0....55 0....85 0....88 0....22 0....51 0....02 0....2 0....67 0....15 0....28 0....45 0....71 0....52 0....08 0..9 0........6 -0.....

Average 2029... Answer 2 Exercise xx-1 Arizona 1977 to 2010 Year Total State and Local Per Capita Taxes Paid Winsorizing ..................................................................35 Average 2117. Standard Deviation 1105. Winsorizing . Answer 3 Special Revenue 5yrMA Forecast based on 5YrMA ..........................................272 Answer 5 ME RMSE MA..

MA.. MA.. How many times the trend? 4 How many times the trend? 3 How many times the trend?

ME -2404..560296 MSE ME -1924.. MSE ME 291.. MSE 10594. RMSE 8624. RMSE 6760.

RMSE Property Tax Levy Property Tax Levy Property Tax Levy Fiscal Year Tax Levy Tax Levy Trend 7 year offset Level Offset Trend Forecast Error Error Sq Fiscal Year Tax Levy Tax Levy Trend 5 year offset Level Offset Trend Forecast Error Error Sq Fiscal Year Tax Levy Tax Levy Trend 3 year offset Level Offset Trend Forecast Error Error Sq ................................................................................................................................................................................................................................................................................................................................................................................................................................................638 Grade Worksheet 4 Total Points Available Item Grade Weight x A mark here makes the numbers in the grade calculation visible. 0.25 Base Points (for trying this exercise) 0.6 Manual Points 3.15 Points to be graded 0 Percent all sheets 0 Graded Points 0 Graph 1 0. Graph 2 0. Graph 3 0. Problem 4 0..25 Initial Grade 0..35 Minimum Earned Points 0..6 Threshold 0 Grade Grade Table A 100% B 90% 0 C 80% 546 D 70% F 0%

Paper For Above instruction

The following analysis examines the tax burden and revenue forecasting methods for various entities within Arizona, utilizing data from multiple tables and applying statistical techniques to generate meaningful insights. The discussion encompasses the graphical depiction of tax data, outlier identification, data adjustment through Windsorizing, and the development of revenue forecasts using moving averages and error analysis to recommend the most accurate method for future planning.

Analysis of Arizona Tax Data and Outliers

The initial task involved plotting a graph of the total state and local per capita taxes paid per year to visualize trends and identify any anomalies or outliers. The graphical analysis revealed consistent fluctuations over the years, with a notable outlier in 2006 when the tax per capita was corrected from $3,368.10 to $6,368.10. This significant deviation distinctly stood out from the general trend, indicating a possible data entry error that warranted correction via the Windsorizing method.

Data Correction with Windsorizing Technique

Windsorizing involves replacing outliers with the nearest non-outlier data points to mitigate their undue influence on analysis. Applying Windsorizing to the Arizona tax data, the outlier in 2006 was adjusted to fall within the range of typical values observed across other years. The graph comparing the original and Windsorized data demonstrated that the correction yielded a more stable and consistent trend, which is crucial for reliable forecasting. This adjustment ensures that the extreme value does not skew the trend analysis or subsequent forecasting models.

Revenue Forecasting Using Moving Averages

For Northland's special revenue fund, a 5-year moving average was calculated to smooth out irregularities and provide a basis for projecting future revenues. The 5-year moving average approach resulted in a steady trend, which was then extended to forecast revenues for the subsequent three years. The calculations showed that despite the non-conforming nature of the data, the moving average method provides a pragmatic means to forecast revenue by reducing short-term fluctuations. The projected revenue figures enable planners to prepare more accurate budgets and resource allocations for FY 2014 to FY 2016.

Forecasting Property Tax Revenues in River County

Extending the analysis to property tax revenues, forecasts were developed using 7-, 5-, and 3-year offset moving averages, incorporating both level and trend components. Error analysis, including Mean Absolute Error (MAE), Mean Squared Error (MSE), and Root Mean Square Error (RMSE), was utilized to evaluate forecast accuracy. The results indicated that the 3-year offset moving average delivered the lowest forecasting errors, suggesting it provides the most precise projections for River County’s property tax revenues. These findings guide the selection of the most appropriate forecasting method, enhancing fiscal planning and resource management.

Conclusion and Recommendations

Effective forecasting of revenue collections necessitates a careful balance between data smoothing and responsiveness to changes. The Windsorizing method proved beneficial in correcting outliers that could distort analyses, exemplified by the 2006 Arizona tax data. Moving averages serve as robust tools for revenue projection, with the 3-year offset approach demonstrating superior accuracy in error metrics. It is recommended that local governments and agencies adopt the 3-year moving average method, coupled with outlier correction techniques, for reliable revenue forecasting. Continuous monitoring and validation of forecast models are essential to adapt to economic fluctuations and ensure fiscal responsibility.

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