214 PRINCIPLES OF AMERICAN FORESTRY. 



Equation: a; ==5X1.06^"+ ^^^ ^-SXl.OG^. 



Result: The cost of producing those 6,550 feet was 

 $5.80. As the value of the 6,550 feet is $9.82, the owner 

 has gained, aside from making 6 per cent, interest on the 

 investment and aside frc»m having the value of the culled 

 forest for an additional asset, about $4 per acre. 



29. A SPRUCE PROBLEM. 



Premises: A lumberman otvtis 20,000 acres of Spi-uce 

 land, from which he has just cut 6,000 feet, board meas- 

 ure, per acre, 12 inches and over in diameter at the stump, 

 worth $1.50 per thousand. After another 20 years he will 

 be able to obtain 3,320 feet per acre, cutting again, down 

 to a 12-inch diameter, and we may expect that after 

 40 years the same yield will be obtained, and so on. 



The land, when cleared, is said to have some value for 

 pasture purposes. The taxes are 4 cents; the expense 

 for administration, protection, etc., 8 cents per acre per 

 annum. Figure at 6 per cent. 



Question: What is the forest worth at the present 

 moment? 



Points: 1. After 20, 40, 60 (and so on) years, a yield 

 of 3,320 feet, board measure, worth $4.98 per thousand feet, 

 can be obtained. 



2. The necessary expenses are 4 cents plus 8 cents per 

 acre per annum. 



3. The value of a forest, like the value of a house or 



a farm or a business, is equal to the present value of all 



returns, minus all expenses, expected from it. 



4 OS 12 

 E,^Hon: x^j^^jg^^-^-;^^ 2.22 -2.00. 



Result: The forest, after lumbering, is worth 22 cents 

 per acre. If the owner can sell it, for farming purposes, 



