﻿MECHANICS 
  OF 
  AIM 
  EVALUATION 
  - 
  AIM 
  EXAMPLE 
  

  

  The 
  steps 
  in 
  the 
  proposed 
  method 
  of 
  evalu- 
  

   ation 
  have 
  been 
  outlined 
  in 
  the 
  introduction. 
  

   The 
  tedious 
  mathematical 
  calculations 
  nor- 
  

   mally 
  associated 
  with 
  rate-of-return 
  compu- 
  

   tations 
  that 
  are 
  complicated 
  can 
  be 
  largely 
  

   eliminated 
  by 
  using 
  one 
  of 
  the 
  several 
  EDP 
  

   investment 
  analysis 
  programs 
  now 
  available. 
  

   Two 
  such 
  programs 
  — 
  one 
  by 
  Hall 
  5 
  and 
  the 
  

   second 
  by 
  Row 
  11 
  — 
  have 
  been 
  adapted 
  for 
  use 
  

   in 
  problems 
  of 
  the 
  kind 
  discussed; 
  in 
  this 
  

   paper. 
  The 
  modified 
  programs 
  are 
  described 
  

   in 
  detail 
  in 
  appendix 
  B. 
  Illustrations 
  in 
  the 
  

   example 
  are 
  taken 
  from 
  computer 
  output 
  of 
  

   these 
  programs. 
  

  

  The 
  example 
  that 
  follows 
  will 
  clarify 
  the 
  

   procedures 
  required, 
  particularly 
  those 
  making 
  

   use 
  of 
  EDP 
  equipment 
  for 
  rate-of-return 
  cal- 
  

   culations. 
  

  

  This 
  illustration 
  of 
  the 
  evaluation 
  and 
  de- 
  

   cision 
  process 
  is 
  designed 
  to 
  show 
  how 
  silvi- 
  

   cultural 
  decisions 
  (or 
  necessities) 
  can 
  influ- 
  

   ence 
  the 
  economic 
  efficiency 
  of 
  timber 
  growing 
  

   operations. 
  The 
  example 
  is 
  somewhat 
  simpli- 
  

   fied 
  and 
  does 
  not 
  take 
  into 
  account 
  all 
  the 
  

   possible 
  alternatives. 
  However, 
  it 
  does 
  show 
  

   the 
  flow 
  of 
  thinking 
  necessary 
  to 
  sound 
  deci- 
  

   sions 
  in 
  stand 
  regeneration. 
  

  

  Problem: 
  From 
  a 
  timber 
  type 
  of 
  several 
  

   hundred 
  acres, 
  a 
  mature 
  stand 
  of 
  white 
  pine 
  

   and 
  Douglas-fir 
  with 
  minor 
  volumes 
  of 
  

   grand 
  fir 
  and 
  Engelmann 
  spruce 
  is 
  to 
  be 
  

   harvested 
  and 
  regenerated 
  for 
  the 
  primary 
  

   purpose 
  of 
  timber 
  production. 
  The 
  timber 
  

   manager 
  is 
  free 
  to 
  decide 
  on 
  cutting 
  unit 
  

   size 
  and 
  layout. 
  The 
  habitat 
  type 
  is 
  a 
  

   spruce-fir 
  climax 
  tree 
  union. 
  

  

  The 
  goal 
  is 
  to 
  grow 
  a 
  merchantable 
  stand 
  

   of 
  sawtimber 
  of 
  mixed 
  species 
  in 
  the 
  most 
  

  

  r 
  °Hall, 
  Otis. 
  Evaluating 
  complex 
  investments 
  in 
  

   forestry 
  and 
  other 
  long-term 
  enterprises 
  using 
  a 
  

   digital 
  computer. 
  Purdue 
  Univ. 
  Res. 
  Bull. 
  752, 
  11 
  

   pp., 
  1962. 
  Also, 
  Supplemental 
  appendix, 
  2 
  pp., 
  1963. 
  

  

  G 
  In 
  Marty, 
  et 
  al. 
  See 
  footnote 
  4. 
  

  

  efficient 
  manner. 
  The 
  criterion 
  of 
  efficiency 
  

   will 
  be 
  the 
  rate 
  of 
  return 
  on 
  investment 
  

   earned 
  by 
  alternative 
  plans 
  that 
  will 
  achieve 
  

   the 
  goal. 
  

  

  Preliminary 
  Selection 
  of 
  Species 
  

  

  The 
  species 
  to 
  be 
  evaluated 
  are 
  those 
  nor- 
  

   mally 
  associated 
  with 
  the 
  habitat 
  (see 
  table 
  

   1) 
  and 
  particularly 
  those 
  that 
  apparently 
  did 
  

   well 
  in 
  the 
  stand 
  to 
  be 
  harvested. 
  As 
  the 
  first 
  

   step 
  in 
  evaluation, 
  the 
  land 
  manager 
  considers 
  

   each 
  of 
  these 
  potential 
  species 
  and 
  makes 
  the 
  

   following 
  decisions: 
  

  

  1. 
  White 
  pine. 
  — 
  Poor 
  risk 
  because 
  of 
  blis- 
  

   ter 
  rust. 
  Drop 
  from 
  consideration. 
  

  

  2. 
  Subalpine 
  fir. 
  — 
  Risk 
  is 
  moderate, 
  but 
  

   trees 
  would 
  have 
  to 
  be 
  planted 
  because 
  seed 
  

   trees 
  are 
  few 
  in 
  existing 
  stand 
  and 
  in 
  stands 
  

   outside 
  harvest 
  area. 
  This 
  species 
  is 
  not 
  usu- 
  

   ally 
  grown 
  in 
  the 
  nursery 
  and 
  probably 
  should 
  

   not 
  be 
  considered. 
  

  

  3. 
  Engelmann 
  spruce. 
  — 
  Some 
  risk 
  because 
  

   of 
  spruce 
  budworm 
  but 
  worth 
  considering. 
  

  

  4. 
  Whitebark 
  pine. 
  — 
  Not 
  good 
  timber 
  

   species; 
  high 
  risk 
  because 
  of 
  blister 
  rust. 
  Drop 
  

   from 
  consideration. 
  

  

  5. 
  Lodgepole 
  pine. 
  — 
  Good 
  species 
  but 
  

   would 
  have 
  to 
  be 
  planted; 
  sufficient 
  seed 
  from 
  

   an 
  acceptable 
  seed 
  zone 
  for 
  producing 
  plant- 
  

   ing 
  stock 
  would 
  be 
  difficult 
  to 
  obtain. 
  Drop 
  

   from 
  consideration. 
  

  

  6. 
  Grand 
  fir. 
  — 
  Some 
  loss 
  expected 
  from 
  

   heart 
  rot 
  but 
  definitely 
  worth 
  consideration. 
  

  

  7. 
  Western 
  larch. 
  — 
  Good 
  species, 
  but 
  ex- 
  

   pected 
  loss 
  in 
  growth 
  and 
  unknown 
  mortality 
  

   from 
  casebearer 
  makes 
  it 
  risky 
  at 
  this 
  time. 
  

   Drop. 
  

  

  8. 
  Douglas-fir. 
  — 
  Moderate 
  risk 
  because 
  of 
  

   spruce 
  budworm 
  but 
  good 
  species 
  to 
  grow. 
  

  

  The 
  elimination 
  process 
  leaves 
  three 
  species 
  

   that 
  are 
  judged 
  likely 
  to 
  produce 
  acceptable 
  

  

  12 
  

  

  