126 VALUATION OF FOREST SOIL. 



It follows that, under the above conditions, it pays to plant 

 beech on such land if the latter can be purchased for £18 6s. 

 an acre or under, which is less than in the case of Scotch pine. 

 The highest expectation value of the soil in the case of beech 

 is obtained under a rotation of 90 years, when -S', = £18 15s., 

 which is somewhat lower than that obtained in the case of 

 Scotch pine. 



2, Matters which affect the Expectation Value of the Soil. 



As indicated by the formula, the expectation value of the 

 soil depends on-f- 



(a.) The absolute amount of receipts and expenses. 



(b.) The length of the rotation. 



(c.) The time when the intermediate returns are realised. 



(d.) The time when the costs of production have to be 



incurred. 

 (e.) The rate of interest with which the calculation is made. 

 Each of these matters must be further considered. 



a. The ahsolute Amounts of Receipts and Expenses. 

 These are influenced, not only by careful management, but 

 also by the choice of species. If, for one and the same piece 

 of land, the calculation is made for different species, the 

 expectation values thus obtained are likely to differ consider- 

 ably; hence the importance of selecting the most suitable 

 species in each case. 



h. The Length of Rotation. 

 As the growing stock has, in the majority of cases, very 

 little value during the first part of the life of a wood, so 

 that the yield would not even cover the cost of harvesting, 

 it follows, that the expectation value of the soil may, under 

 a very short rotation, be negative. With advancing age, the 

 value of the growing stock increases, so that the expectation 

 value of the soil becomes positive; it goes on augmenting, 

 until it reaches a maximum, after which time it falls 



