VAI,UD OF GROWING STOCK 6 1 



have no regular sale value and this is true even of stands abroad, 

 for the sale of such stands is not sufficiently common, even there. 



The same stand may be sold to a man who wants to keep it 

 until it is seventy years old and of better size and quality. He would 

 have considerable expense holding the stand ; interest on the money 

 he has to pay for the stand, rent to the owner of the land , care and 

 protection for twenty years and taxes for this period. To determine 

 what he could pay for the stand he would assume a certain value 

 which the stand is expected to have at seventy years, deduct all ex- 

 penses and find what he may expect to get at the end of twenty 

 years when the stand is cut. He would discount this to present date 

 and get the present value of the stand on the basis of his expecta- 

 tions. This would be the expectation value of the stand. 



The owner who wishes to sell the stand would set the price 

 first of all by the amount which it has cost to produce the stand, by 

 the cost value of the stand. This cost value of an even-aged, plant- 

 ed stand he can determine exactly as the farmer finds the cost of 

 producing an acre of corn. He charges the expense of planting, the 

 rent on the land, taxes and care. But unlike the farmer he has to 

 charge and compound these sums for the whole fifty years or the 

 age of the stand. 



Any stand of timber regardless of age or size has the usual 

 three values, cost, sale and expectation, with the sale value rather 

 indefinite for non-merchantable stands. 



a. Sale value of growing stock. 



Since this is largely a matter of stumpage of marketable stuff 

 either for immediate use or to hold for future use, and since in the 

 United States this is important chiefly in connection with our wild 

 woods, it is discussed under stumpage value in chapter VI. 



\ b. Cost value of growing stock. 



The usual case for an even-aged stand of timber is as follows : 

 I. Area of stand, 80 acres; age, m, 45 years, interest rate, p, 



2%. 



Premises per acre : 



Cost value of land, Sc, $5, therefore rent Sc (.op) is ten cents. 



Cost of planting, c, $8. 



Current expenses yearly, e, 50 cents. 



Income from thinnings : 



^ Thinning at age of 20 years, Ta, costs $3, negative income, 

 30 Tb, just paid for cutting, 



40 Tc, 5 cords of wood worth $10. 



