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Question: You purchased 40 acres of forest land for $50,000 as an investment. After three years, you prune your trees at a cost of $100 per acre. You estimate your income from selective timber harvesting will be $3,000 per acre beginning 20 years from when you purchased the property and occurring every 10 years thereafter in perpetuity. You have annual property taxes of $4 per acre starting next year. What is the present value of this investment, assuming a 6 percent discount rate?

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Basic Finance, Finance

Category:- Basic Finance
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