Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Optimal Harvesting Age
Let there be a per unit regeneration cost C. The timber growth is measured by volume V(T) which is a function of the age of the timber T. Attaching a price P, the maximum present value of the stand represented by λ is,
Equation 1
The first order condition gives us
Equation 2
PV' (T) = iPV (T) + i λ
Where V’ is the first order derivative of V.
The results indicate that, the Faustmann harvest age TF, is the one at which the marginal increase in value from delaying the harvest equals opportunity cost of delaying the harvest. The opportunity cost includes the potential interest income foregone on the delayed receipt of current harvest revenues plus the interest cost of delaying receipts from future harvest cycles. The second component reflects an implicit rental cost of land. The optimum T is popularly known as 'Faustmann Rotation Age'. Let us denote it by TF.
The first order condition equation 2 can be rewritten to give us the Faustmann condition
Equation 3
Equation 3 can be interpreted as, 'hold timber stocks uncut until the rate of growth in the combined asset value of timber and land just equals market rate of interest'.
what is the difference between budget deficit and fiscal deficit
Related Goods Approaches - Direct Substitute Approach Normal 0 false false false EN-IN X-NONE X-NONE MicrosoftInterne
examine the efficiency of quantitative credit control instruments.
Quantitative policy process depends on a portfolio of tools that have been drawn from a variety of disciplines besides discretionary political decision. Over the past two decades
Normal 0 false false false EN-IN X-NONE X-NONE MicrosoftInternetExplorer4
Q. Show the Redistribution Policy? We know that despite policy interventions the disparity of income has been increasing in nearly all the countries. United States is highly un
Ask quedoes privatisation decentralise economic power stion #Minimum 100 words accepted#
summarize the basic tenets of mark davis arguments
Question: Awards for excellent performance are increasingly employed within the public service in many countries. These will or will not have a financial value. Performance-rel
Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!
whatsapp: +1-415-670-9521
Phone: +1-415-670-9521
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd