78 PRACTICAL FORESTRY IN 



tically the cost of holding the tract for any given number of 

 years. By calculating this cost upon a basis of one acre, and 

 dividing it by the yield board measure which the same period 

 will produce, the cost per thousand feet of growing a second 

 crop is arrived at. 



Against this may be set the gross return from the same 

 expected yield at any given stumpage rate. The yield at the 

 end of a 50-year investment will not be that of a 50-year 

 forest, however, for although the carrying cost begins at 

 once, the new forest requires a few years to become estab- 

 lished. No exact figure can be set for this, for some seed will 

 sprout the first year and some blank spaces may persist sev- 

 eral years, but in the tables to follow five years has been 

 allowed for an average. Consequently, instead of calculating 

 on a 28 M yield as the return at the end of 50 years, as indi- 

 cated in the yield table on the preceding page, the 45-year 

 yield of 201/2 M is used, and similarly for the other periods of 

 60, 70 and 80 years. These four rotations only will be consid- 

 ered here, for in less than 50 years second growth will prob- 

 ably be too small to be cut at the highest profit, while after 

 80 years the investment compounds so heavily as to make it 

 improbable that increasing stumpage values will compensate. 



Three interest rates have been used in the first table to 

 follow: 4, 5 and 6 per cent, compound. Forest calculations 

 at lower rates are often seen, but it is not believed that less 

 than 5 per cent will be satisfactory to private owners and 

 many will insist on 6 per cent. The fair standard is what the 

 owner can make in other business today, and since he can re- 

 invest his income in the same business, it is reasonable to 

 figure at a compound rate. A few examples are given to 

 show how similar calculations may be made with any set of 

 investment and stumpage factors which appeal to individual 

 judgment. The second table, prepared from the first, shows 

 at a glance the price that must be received for Douglas fir 

 to make it pay either 5 or 6 per cent compound interest under 

 a range of sixty different conditions of original investment 

 and annual cost. 



