CHOICE BETWEEN FORESTRY AND AGRICULTURE. 167 



SECTION II. THE FINANCIAL TEST APPLIED TO THE METHOD 

 OF TREATMENT. 



If the profitableness of the method of treatment is to be 

 tested, or if several methods are to be compared, it must be 

 assumed that in each case those conditions exist, which render 

 the method in itself as profitable as possible. In this case, it 

 may be said that :, The most advantageous method of treat- 

 ment, from a financial point of view, is that which yields the 

 highest profit, or the highest mean annual forest per cent., 

 provided, in the latter case, the capital is the same under 

 each method. If the capitals differ, the following cases must 

 be distinguished : 



(1) The method employing the greater capital is the more 



profitable, if it gives the higher forest per cent. 



(2) The one with the smaller capital is the more profitable, 



if it yields an equal or a greater amount of interest. 

 If it yields less interest and yet a higher forest per 

 cent., it cannot be decided off-hand whether it is the 

 more profitable or not, as the total profit depends on 

 two factors, namely, the rate of interest and the 

 amount of the invested capital ; hence it is necessary 

 to calculate the actual amounts of profit for each case 

 and to compare them. 



The above-mentioned tests may be applied to all questions 

 connected with forest management. Of these the following 

 are the most prominent : 



1. Choice between Forestry and Agriculture as regards a Piece 



of Land. 



Of these two methods of using the land that is the more 

 profitable which yields the highest net rental of the soil. 



Rental of soil under forest = 



l'op r -l 



