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An area of land will be assigned to the following prescription after the next harvest. Reforestation occurs immediately after harvest at a cost of $700/ha. A commercial thin occurs at 40 years of age with a net revenue of $2 000/ha. A final harvest occurs at age 70 with a net revenue of $15 000/ha. This management prescription is assumed to be repeated in perpetuity. What is the soil expectation value for this management prescription, assuming a discount rate of 5%? Soil expectation value = (net revenue / (1+i)^rotation age) - 1

An area of land will be assigned to the following prescription after the next harvest. Reforestation occurs immediately after harvest at a cost of $700/ha. A commercial thin occurs at 40 years of age with a net revenue of $2 000/ha. A final harvest occurs at age 70 with a net revenue of $15 000/ha. This management prescription is assumed to be repeated in perpetuity. What is the soil expectation value for this management prescription, assuming a discount rate of 5%? Soil expectation value = (net revenue / (1+i)^rotation age) - 1

Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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An area of land will be assigned to the following prescription after the next harvest. Reforestation occurs immediately after harvest at a cost of $700/ha. A commercial thin occurs at 40 years of age with a net revenue of $2 000/ha. A final harvest occurs at age 70 with a net revenue of $15 000/ha. This management prescription is assumed to be repeated in perpetuity. What is the soil expectation value for this management prescription, assuming a discount rate of 5%? Soil expectation value = (net revenue / (1+i)^rotation age) - 1
Transcribed Image Text:An area of land will be assigned to the following prescription after the next harvest. Reforestation occurs immediately after harvest at a cost of $700/ha. A commercial thin occurs at 40 years of age with a net revenue of $2 000/ha. A final harvest occurs at age 70 with a net revenue of $15 000/ha. This management prescription is assumed to be repeated in perpetuity. What is the soil expectation value for this management prescription, assuming a discount rate of 5%? Soil expectation value = (net revenue / (1+i)^rotation age) - 1
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