Charts from Appendix D of FCC 97-159

D1

E1 X-Fctr

Chart D1: Components of FCC LEC Price Cap X-Factor [Excluding CPD]
Input Price Growth Rates Total Factor Productivity Growth Rates LEC
Total U.S. Nonfarm Differential Total U.S. Nonfarm Differential Price/Productivity
RBOCs Business Sector RBOCs Business Sector Differential
Year A B C = B - A D E F = D - E G = C + F
1986 4.94% 2.81% -2.13% 2.58% 0.92% 1.66% -0.5%
1987 0.56% 2.53% 1.97% 2.97% -0.02% 2.99% 5.0%
1988 -1.58% 3.73% 5.31% 0.12% 0.46% -0.33% 5.0%
1989 -2.36% 3.04% 5.40% 1.94% -0.55% 2.50% 7.9%
1990 1.88% 3.31% 1.43% 6.85% -0.47% 7.33% 8.8%
1991 -0.85% 2.06% 2.91% 2.03% -0.89% 2.92% 5.8%
1992 2.67% 2.88% 0.21% 4.32% 1.10% 3.21% 3.4%
1993 2.27% 3.72% 1.44% 3.81% 0.55% 3.26% 4.7%
1994 -0.19% 3.50% 3.69% 2.21% 0.50% 1.71% 5.4%
1995* 1.31% 3.09% 1.78% 5.20% 0.16% 5.04% 6.8%
Averages
[1986-94] 0.82% 3.06% 2.25% 2.98% 0.18% 2.80% 5.1%
[1986-95] 0.87% 3.07% 2.20% 3.20% 0.17% 3.03% 5.2%
[1987-95] 0.41% 3.10% 2.68% 3.27% 0.09% 3.18% 5.9%
[1988-95] 0.39% 3.17% 2.77% 3.31% 0.11% 3.20% 6.0%
[1989-95] 0.68% 3.09% 2.41% 3.77% 0.06% 3.71% 6.1%
[1990-95] 1.18% 3.09% 1.91% 4.07% 0.16% 3.91% 5.8%
[1991-95] 1.04% 3.05% 2.01% 3.51% 0.28% 3.23% 5.2%
*Columns B and E for 1995 are estimated, based on the average of 1990-1994.

Last Update: 5/21/97

Name: AMDIM\CSLC

E2-3

E2-3

Intrastate Toll
Local Service and Intrastate Interstate Total
Access
A B C D = A + B + C
Year
1985 $26,960,554,164 $13,047,095,682 $14,366,305,727 $54,373,955,573
1986 $28,626,174,049 $13,538,946,795 $15,459,541,700 $57,624,662,544
1987 $29,150,842,991 $14,166,723,124 $15,360,313,555 $58,677,879,670
1988 $29,226,988,000 $14,994,975,000 $15,806,448,000 $60,028,411,000
1989 $29,973,157,000 $14,868,219,000 $15,745,189,000 $60,586,565,000
1990 $30,699,085,000 $15,014,729,000 $15,483,956,000 $61,197,770,000
1991 $32,059,008,000 $14,522,276,000 $15,461,344,000 $62,042,628,000
1992 $33,359,990,000 $14,225,181,000 $15,767,707,000 $63,352,878,000
1993 $34,598,957,000 $14,496,831,000 $16,341,156,000 $65,436,944,000
1994 $35,758,637,000 $14,355,983,000 $17,100,570,000 $67,215,190,000
1995 $37,684,860,000 $13,123,225,000 $17,632,821,000 $68,440,906,000

Last Update: 5/21/97

Name: AMDIM\CSLC

D4 & D5

E4-5

Chart D4: Calculation of Fisher Ideal Index for Interstate Output
Revenue Shares Quantities Output Indices Interstate
End User Interstate Special Access Switched Special Laspeyres Paasche Fisher Output
Year Switched Access Access Lines Access Minutes Access Relative Quantity Index Growth
Lines A B C=(A*B)^0.5
1985 10.44% 75.92% 13.65% 92,671,959 156,853,820,000 1,230,590 1.000000 1.000000 1.000000 1.000000
1986 15.53% 67.82% 16.66% 95,333,884 157,302,701,000 1,664,101 1.053249 1.052253 1.052751 1.052751 5.14%
1987 20.12% 62.58% 17.30% 98,228,585 173,154,171,000 1,764,445 1.083098 1.078813 1.080953 1.137975 7.78%
1988 22.80% 61.13% 16.07% 98,270,787 187,663,836,000 2,701,817 1.144443 1.114960 1.129605 1.285462 12.19%
1989 27.94% 57.75% 14.31% 101,190,050 210,406,134,000 2,448,090 1.065766 1.058920 1.062338 1.365595 6.05%
1990 30.22% 55.51% 14.27% 103,857,988 231,960,296,000 3,518,005 1.129086 1.114500 1.121769 1.531882 11.49%
1991 31.23% 55.07% 13.71% 107,383,807 246,710,182,000 5,151,699 1.111811 1.094856 1.103301 1.690127 9.83%
1992 31.48% 54.86% 13.66% 108,938,065 262,187,655,000 6,033,139 1.062516 1.060258 1.061386 1.793878 5.96%
1993 32.09% 55.07% 12.84% 112,196,681 278,173,161,000 10,153,615 1.136148 1.102619 1.119258 2.007812 11.27%
1994 32.69% 54.35% 12.97% 115,264,861 298,342,017,323 13,824,365 1.095119 1.086800 1.090952 2.190425 8.71%
1995 32.72% 52.93% 14.35% 119,887,506 334,981,582,000 16,107,677 1.101268 1.099925 1.100596 2.410774 9.59%
Average [1986-94] 8.71%
Average [1986-95] 8.80%
Chart D5: Calculation of Fisher Ideal Index for Total Company Output
Revenue Shares Quantities Output Indices Total
Intrastate Toll Number of Intrastate Interstate Laspeyres Paasche Fisher Company
Local Service and Intrastate Interstate Local Calls DEMs Quantity Relative Output
Year Access Index Index Growth
A B C=(A*B)^0.5
1985 49.58% 24.00% 26.42% 310,696,999,600 164,191,177,000 1.000000 1.000000 1.000000 1.000000 1.000000
1986 49.68% 23.50% 26.83% 315,839,746,231 173,173,536,000 1.052751 1.035272 1.034895 1.035083 1.035083 3.45%
1987 49.68% 24.14% 26.18% 320,735,770,416 183,597,411,000 1.137975 1.043561 1.042639 1.043100 1.079696 4.22%
1988 48.69% 24.98% 26.33% 318,724,184,964 191,904,837,000 1.285462 1.041736 1.039449 1.040592 1.123522 3.98%
1989 49.47% 24.54% 25.99% 330,212,044,704 207,298,177,000 1.365595 1.054001 1.053389 1.053695 1.183850 5.23%
1990 50.16% 24.53% 25.30% 342,403,840,684 217,913,904,000 1.531882 1.062478 1.060759 1.061618 1.256797 5.98%
1991 51.67% 23.41% 24.92% 353,219,571,000 219,713,721,000 1.690127 1.044009 1.042832 1.043420 1.311367 4.25%
1992 52.66% 22.45% 24.89% 365,468,629,000 224,278,538,000 1.793878 1.038080 1.038005 1.038042 1.361254 3.73%
1993 52.87% 22.15% 24.97% 376,995,406,000 227,540,869,000 2.007812 1.049556 1.048164 1.048860 1.427765 4.77%
1994 53.20% 21.36% 25.44% 392,601,075,000 235,362,364,000 2.190425 1.052215 1.052028 1.052121 1.502182 5.08%
1995 55.06% 19.17% 25.76% 409,383,799,000 246,926,539,000 2.410774 1.058829 1.058314 1.058572 1.590167 5.69%
Average [1986-94] 4.52%

Last Update: 5/21/97

Name: AMDIM\CSLC

D6

E6

Chart D6: Labor Input Price and Growth
Labor Price Labor
RBOC Total Total Labor Rate Index Growth
Year Employees Compensation Annual (Base = 1985)
A B C = B / A %Chg in A
1985 504,113 16,991,572,326 33,706 1.000000
1986 482,698 16,728,435,454 34,656 1.028192 -4.34%
1987 477,714 16,978,905,847 35,542 1.054474 -1.04%
1988 466,827 17,030,359,791 36,481 1.082336 -2.31%
1989 461,149 16,910,850,694 36,671 1.087974 -1.22%
1990 443,105 17,586,868,921 39,690 1.177541 -3.99%
1991 414,457 17,186,211,200 41,467 1.230255 -6.68%
1992 411,167 17,160,988,000 41,737 1.238279 -0.80%
1993 395,639 17,956,438,000 45,386 1.346528 -3.85%
1994 367,196 17,154,284,000 46,717 1.386018 -7.46%
1995 346,843 16,203,522,000 46,717 1.386024 -5.70%
Average [1986-94] -3.52%
Average [1986-95] -3.74%
*Sources:
Column A: ARMIS data for total of full and part-time employees.
Column B: SOCC

Last Update: 5/21/97

Name: AMDIM\CSLC

D7

E7

Chart D7: Summary of Capital Adjustments and Average Depreciation
Adjustment Adjusted EOY Depreciation Adjusted
Year TPIS.BOY Unadj. Additions TPIS.EOY Retires Factor Adjusted Additions TPIS Accruals Depreciation Rate
A B C D=A+B-C E F = B * E G = A+F-D H I=H/((A+G)/2)
1985 138,879,365 15,001,998 149,061,793 4,819,569 0.8880 13,322,021 147,381,816 10,241,376 7.155%
1986 149,061,793 14,842,725 159,010,189 4,894,328 0.8880 13,180,584 157,348,048 11,826,961 7.720%
1987 159,010,189 14,138,370 167,720,577 5,427,983 0.8880 12,555,105 166,137,312 13,311,655 8.188%
1988 168,505,114 14,284,742 175,860,216 6,929,640 1.0000 14,284,742 175,860,216 13,134,992 7.629%
1989 175,860,216 13,283,569 182,978,381 6,165,404 1.0000 13,283,569 182,978,381 13,420,810 7.480%
1990 182,978,381 14,476,334 187,168,695 10,286,020 1.0000 14,476,334 187,168,695 13,439,933 7.262%
1991 187,168,695 14,527,049 192,034,545 9,661,199 1.0000 14,527,049 192,034,545 13,200,593 6.962%
1992 192,034,545 14,611,866 196,411,915 10,234,496 1.0000 14,611,866 196,411,915 13,337,581 6.867%
1993 196,411,915 14,860,116 203,082,418 8,189,613 1.0000 14,860,116 203,082,418 14,032,782 7.025%
1994 203,082,418 14,717,999 209,325,562 8,474,855 1.0000 14,717,999 209,325,562 14,863,196 7.208%
1995 209,325,562 15,374,568 217,430,207 7,269,923 1.0000 15,374,568 217,430,207 15,358,553 7.198%
Average [1985-95] 7.336%
Sources:
Columns A, B, C and H are revised Form M data compiled by the Accounting and Audits Division of the FCC Common Carrier Bureau.
Column E is derived from Christensen's USTA Revised Study of 1995.

Last Update: 5/21/97

Name: AMDIM\CSLC

D8a

E8

1995 1.2639 56,831,094,000 15,556,284,000 16,203,522,000 25,071,288,000 19,836,681,477 1.423332 3.27%
Average 3.53%
Sources: Column A: Derived from BLS data as described in text. 1994 and 1995 values are extrapolated.
Column B: SOCC. 1985-87 Data adjusted by USTA Methodology shown in Chart 8a below.
Column C: SOCC
Column D: ARMIS
Chart D8a: Adjustments of 1985-87 RBOC Operating Expenses for Accounting Changes
USTA Study RBOC
Operating Nonregulated Capital/Expense Shift Operating Adjusted
Expense Expense Adjustmts Shift Factor Expense Operating Exp.
A B C D = (A+B+C)/A E F = D * E
1985 46,223,368,251 406,886,403 1,985,079,714 1.05175 38,938,104,053 40,953,072,435
1986 48,113,849,487 471,112,072 1,959,363,711 1.05052 40,384,079,165 42,424,084,849
1987 49,562,282,080 1,089,570,002 1,908,791,665 1.06050 41,766,392,483 44,293,127,430
Sources: Columns A-C: Christensen data from USTA Revised 1995 Study
Column E: SOCC

Last Update: 5/21/97

Name: AMDIM\CSLC

D9

E9

Chart D9: Capital Quantity and Price Index Calculations
Capital
Adjusted BEA Capital Stock Capital Capital Input Property Capital Rental Price
Capital Composite Quantity Input Quantity Income Capital Rental Price Index
Year Benchmark Additions Asset Price Quantity Growth /w Depreciation Rental Price** Index Growth
A B C D E F G H I J
(Base = 1985)
1984 n/a 103,903,095
1985 109,602,959 13,322,021 1.000000 109,602,959 1.000000 23,445,593,794 0.22565 1.00000
1986 13,180,584 1.013181 114,571,778 1.054857 5.34% 26,792,578,943 0.24445 1.08333 8.00%
1987 12,555,105 1.030871 118,346,112 1.102679 4.43% 27,701,751,800 0.24179 1.07151 -1.10%
1988 14,284,742 1.035999 123,452,811 1.139005 3.24% 26,866,209,000 0.22701 1.00605 -6.30%
1989 13,283,569 1.075241 126,750,564 1.188153 4.22% 25,845,853,000 0.20936 0.92781 -8.10%
1990 14,476,334 1.092233 130,706,243 1.219892 2.64% 25,584,541,000 0.20185 0.89453 -3.65%
1991 14,527,049 1.106013 134,252,460 1.257963 3.07% 24,641,357,000 0.18852 0.83548 -6.83%
1992 14,611,866 1.111942 137,544,780 1.292093 2.68% 26,477,135,000 0.19722 0.87401 4.51%
1993 14,860,116 1.123482 140,681,565 1.323779 2.42% 26,914,823,000 0.19568 0.86719 -0.78%
1994 14,717,999 1.140461 143,266,703 1.353969 2.25% 26,366,385,000 0.18742 0.83058 -4.31%
1995 15,374,568 1.150848 146,116,232 1.378849 1.82% 27,166,096,000 0.18962 0.84033 1.17%
Average [1986-94] 3.37% Average [1986-94] -2.06%
Average [1986-95] 3.21% Average [1986-95] -1.74%
Notes:
Column D equals prior year Capital Stock less depreciation (7.336%) plus Column B deflated by Column C.
Column H equals Column G divided by 1000 times prior year Column D.

Last Update: 5/21/97

Name: AMDIM\CSLC

D10

E10

Chart D10: Factor Shares of Total Payments
Property
Property Total Labor Materials Income
Labor Materials Income Factor Compensation Payment /w Depreciation
Year Compensation Payment /w Depreciation Payment Share Share Share
1985 16,991,572,326 13,936,789,453 23,445,593,794 54,373,955,573 31.25% 25.63% 43.12%
1986 16,728,435,454 14,103,648,147 26,792,578,943 57,624,662,544 29.03% 24.48% 46.49%
1987 16,978,905,847 13,997,222,023 27,701,751,800 58,677,879,670 28.94% 23.85% 47.21%
1988 17,030,359,791 16,131,842,209 26,866,209,000 60,028,411,000 28.37% 26.87% 44.76%
1989 16,910,850,694 17,829,861,306 25,845,853,000 60,586,565,000 27.91% 29.43% 42.66%
1990 17,586,868,921 18,026,360,079 25,584,541,000 61,197,770,000 28.74% 29.46% 41.81%
1991 17,186,211,200 20,215,059,800 24,641,357,000 62,042,628,000 27.70% 32.58% 39.72%
1992 17,160,988,000 19,714,755,000 26,477,135,000 63,352,878,000 27.09% 31.12% 41.79%
1993 17,956,438,000 20,565,683,000 26,914,823,000 65,436,944,000 27.44% 31.43% 41.13%
1994 17,154,284,000 23,694,521,000 26,366,385,000 67,215,190,000 25.52% 35.25% 39.23%
1995 16,203,522,000 25,071,288,000 27,166,096,000 68,440,906,000 23.68% 36.63% 39.69%

Last Update: 5/21/97

Name: AMDIM\CSLC

D11 & D12

E11-12

Chart D11: Input Quantity Index
Shares Quantities Quantity Indices
Labor Materials Property Labor Materials Capital Laspeyers Paasche Fisher Fisher
Year Compensation Payment Income Relative Chain Growth
/w Depreciation A B C=(A*B)^0.5
1985 31.25% 25.63% 43.12% 504,113 13,936,789,453 1.00000 1.00000 1.00000 1.00000 1.00000
1986 29.03% 24.48% 46.49% 482,698 13,816,310,326 1.05486 1.00816 1.00925 1.00871 1.00871 0.87%
1987 28.94% 23.85% 47.21% 477,714 13,519,006,111 1.10268 1.01281 1.01236 1.01259 1.02140 1.25%
1988 28.37% 26.87% 44.76% 466,827 15,233,555,068 1.13900 1.03921 1.03940 1.03930 1.06155 3.86%
1989 27.91% 29.43% 42.66% 461,149 16,230,415,414 1.18815 1.03345 1.03336 1.03340 1.09701 3.29%
1990 28.74% 29.46% 41.81% 443,105 15,765,836,293 1.21989 0.99205 0.99058 0.99132 1.08748 -0.87%
1991 27.70% 32.58% 39.72% 414,457 17,288,093,619 1.25796 1.02291 1.02204 1.02247 1.11192 2.22%
1992 27.09% 31.12% 41.79% 411,167 16,514,721,412 1.29209 0.99400 0.99433 0.99417 1.10544 -0.59%
1993 27.44% 31.43% 41.13% 395,639 17,056,843,079 1.32378 1.01023 1.00915 1.00969 1.11615 0.96%
1994 25.52% 35.25% 39.23% 367,196 19,197,642,055 1.35397 1.02910 1.02911 1.02910 1.14863 2.87%
1995 23.68% 36.63% 39.69% 346,843 19,836,681,477 1.37885 1.00480 1.00510 1.00495 1.15432 0.49%
Average [1986-94] 1.54%
Average [1986-95] 1.44%
Chart D12: Input Price Index
Shares Factor Price Indices Input Price Indices
Labor Materials Property Labor Materials Capital Laspeyers Paasche Fisher Fisher
Year Compensation Payment Income Relative Chain Growth
1984 /w Depreciation A B C=(A*B)^0.5
1985 31.25% 25.63% 43.12% 1.00000 1.00000 1.00000 1.00000 1.00000 1.00000 1.00000
1986 29.03% 24.48% 46.49% 1.02819 1.02080 1.08333 1.05007 1.05120 1.05064 1.05064 4.94%
1987 28.94% 23.85% 47.21% 1.05447 1.03537 1.07151 1.00584 1.00539 1.00562 1.05654 0.56%
1988 28.37% 26.87% 44.76% 1.08234 1.05897 1.00605 0.98424 0.98442 0.98433 1.03998 -1.58%
1989 27.91% 29.43% 42.66% 1.08797 1.09855 0.92781 0.97671 0.97663 0.97667 1.01572 -2.36%
1990 28.74% 29.46% 41.81% 1.17754 1.14338 0.89453 1.01969 1.01818 1.01894 1.03496 1.88%
1991 27.70% 32.58% 39.72% 1.23025 1.16931 0.83548 0.99195 0.99110 0.99152 1.02618 -0.85%
1992 27.09% 31.12% 41.79% 1.23828 1.19377 0.87401 1.02694 1.02728 1.02711 1.05400 2.67%
1993 27.44% 31.43% 41.13% 1.34653 1.20571 0.86719 1.02353 1.02243 1.02298 1.07823 2.27%
1994 25.52% 35.25% 39.23% 1.38602 1.23424 0.83058 0.99812 0.99813 0.99812 1.07620 -0.19%
1995 23.68% 36.63% 39.69% 1.38602 1.26389 0.84033 1.01307 1.01337 1.01322 1.09044 1.31%
Average [1986-94] 0.82%
Average [1986-95] 0.87%

Last Update: 5/21/97

Name: AMDIM\CSLC