a. An industrial Douglas-fir plantation generates a net revenue of $50,000/acre at clear cut age 40. The stand regeneration cost is $350/acre and a herbicide treatment at age 10 costs $120/acre.Compute the LEV per acre when the discount rate is 7%.

b. Suppose that the industrial Douglas-fir stand is currently 25 years old. Compute the per acre value of the 25-year old stand given the above information.