160 THE FINANCIAL RESULTS OF FORESTRY. 



-S c . . . . . . . . . (HI.) 



In this formula expression (II.) represents the expectation 

 value of the soil discounted for r m years, and the bracketed 

 part of expression (III.) represents the cost value of the m 

 years old growing stock ; hence the above formula can be 

 written as follows : 



Profit P = 



Y r +T a xl'op r - n +. . . + T q x 



Here again the positive part represents the expectation 

 value of the forest (see page 149), and the negative part the 

 cost value of the forest ; hence : 



Profit P = m F e - m F e . 



It will be seen that this formula agrees with that given for 

 a blank because for the year o the expectation value of the 

 forest is equal to the expectation value of the soil, and the 

 same holds good for the cost values. 



The conclusions drawn on page 158, headings (1) to (4), 

 with regard to the formula P = S e S c also hold good with 

 regard to the formula P = F e F c . 



b. Calculation for the Annual Working. 



In this case the returns and costs occur regularly every 

 year. If they are of annually equal amounts, the returns 

 are = Y r + T a + . . . . + T q . 



The costs consist every year of 



(1) Interest on the value of the soil . . = rxS X'op; 



(2) normal grow- 



ing stock . . . . . =rx n G X'op; 

 (8) The annually recurring cost of a4minis- 



tration, protection, taxes, etc. . . =rxEx 'op ; 

 (4) The cost of formation . . . . = c ; 



