Regression Analysis:

Regression analysis is a statistical method used to examine relationships between variables and

make predictions.

To estimate sales tax revenue, a CGFM can use regression to analyze how population growth,

housing, and employment trends correlate with tax revenue over time.

Explanation of Answer Choices:

A . Regression analysis: Correct. This method uses historical and predictive data to model the

relationship between variables (e.g., population growth and sales tax revenue).

B . Cash flow analysis: Focuses on analyzing cash inflows and outflows, not predicting revenue based

on external factors.

C . Payback analysis: Used to calculate the time needed to recover an investment, unrelated to tax

revenue estimation.

D . Flow charting: Used to visualize processes, not for predictive analytics.

Reference:

Association of Government Accountants (AGA), Predictive Analytics in Public Sector Finance.

U.S. Census Bureau, Data Analytics for Revenue Forecasting.