THE FINANCIAL ROTATION. 195 



compound interest, the highest net return. The financial 

 rotation is, therefore, identical with that which — 



(a.) Gives the maximum soil rental as expressed by the 

 formula — 



Soil rental = SeX'Op 



^ y,. + i\ X 1-Op'-" + . . . +z;x VOi/-' - c X l-Oj / _ , 

 l-Oj;'- - 1 '' 



'Op 

 (See page 149.) 



{b.) Or yields the highest profit : — 



P = S^—Sc, respectively = F^—F,. 



(See pages 153 and 155.) 



(c.) Or yields the maximum mean annual forest per cent. : — 



S /<' 



"'"'"j9^. =: _5 X p, respectively = ^r X P- 



(See pages 161 and 162.) 



Of these, the first formula is the most convenient, and the 

 procedure is as follows : — In the forest (for which the finaiicial 

 rotation shall be determined), a number of typical woods are 

 examined and as many data as possible collected. These can 

 be augmented by data taken from suitable yield tables, if such 

 are available. Then the soil rental is calculated for various 

 rotations, and that, for which the rental becomes a maximum, 

 is the financial rotation. 



In order to explain the method, the appended table has been 

 calculated from the money yield table for the Scotch pine 

 given at page 120. In calculating that table, it has been 

 assumed, that the cost of formation comes to 60 shillings, the 

 annually recurring costs to 3 shillings, and that the general 

 per cent, p = 2^ per cent. It has also been assumed, that the 

 thinnings during the several periods of ten years have been 

 made at the end of each period ; for instance, the thinnings 



o 2 



