Practicing section vii from Chapter 5.a Use the table below for questions 1-3 Age od Stand in Years Tons per acre Accounting Profits if Accounting profits if harvested from stand harvested in that year harvested last year and (profits = $0.20 per profits invested at a ton) real, risk-free rate of return 4% 30 16800 -------------------- 31 18000 32 18800 33 19000 34 19100 An optimal age to harvest the tree stand is 30 31 32 33 What were the accounting profits in year 31? 3,600 3,360 2,800 2,884 As the real, risk-free interest rate rises, a stand of trees will be harvested at A younger age An older age The same age Impossible to tell
Practicing section vii from Chapter 5.a Use the table below for questions 1-3 Age od Stand in Years Tons per acre harvested from stand Accounting Profits if harvested in that year (profits = $0.20 per ton) Accounting profits if harvested last year and profits invested at a real, risk-free rate of return 4% 30 16800 -------------------- 31 18000 32 18800 33 19000 34 19100 An optimal age to harvest the tree stand is 30 31 32 33 What were the accounting profits in year 31? 3,600 3,360 2,800 2,884 As the real, risk-free interest rate rises, a stand of trees will be harvested at A younger age An older age The same age Impossible to tell
harvestpractice.docx