Franchise taxes are levied on businesses that gain a franchise right of doing business in a jurisdiction’s territory. The data in Table 9.1 are franchise tax revenues in the city of Sunbelt, Florida, from Year 1 to Year 9. During forecasting, you are informed that BellSouth’s (the local telephone service provider) current franchise contract with the city ends in Year 11. The city will seek a 10 percent franchise tax increase from the previous year’s basis from BellSouth in Year 12. The franchise tax revenues from BellSouth during the last nine years are shown in Table 9.2. Forecast the franchise tax revenues of Years 10 to 12. Write short summary of your findings. You should be using all four forecasting techniques (SMA, TMA, EXS, and regression).
Table 9.1–Franchise Taxes in Sunbelt
| Year | Revenues |
| 1 | $ 12,442,000.00 |
| 2 | $ 12,427,000.00 |
| 3 | $ 13,091,000.00 |
| 4 | $ 13,743,000.00 |
| 5 | $ 14,306,000.00 |
| 6 | $ 15,089,000.00 |
| 7 | $ 15,257,000.00 |
| 8 | $ 16,749,000.00 |
| 9 | $ 17,655,000.00 |
Table 9.2–Franchise Taxes from BellSouth in Sunbelt
| Year | Revenues |
| 1 | $ 3,727,000.00 |
| 2 | $ 4,100,000.00 |
| 3 | $ 3,927,000.00 |
| 4 | $ 4,435,000.00 |
| 5 | $ 5,722,000.00 |
| 6 | $ 6,036,000.00 |
| 7 | $ 5,950,000.00 |
| 8 | $ 6,700,000.00 |
| 9 | $ 7,062,000.00 |