Gce Model Questions Vol1 2024 Agricultural Science Question 13
Practice objective / multiple choice question 13 from the 2024 Gce Model Questions Vol1 Agricultural Science examination.
An 100‑ha forest is managed for timber. At the end of a 25‑year rotation each hectare yields 120 m³ of timber. The market price of timber is N 180 m³⁻¹ and a re‑planting cost of N 2 500 ha⁻¹ is incurred at harvest. The discount rate is 6 % per annum. An alternative annual cash‑crop can generate a profit of N 5 000 ha⁻¹ each year for the same 25 years. Using the present‑value formula \(PV = \dfrac{R}{(1+r)^t}\) for a single future cash flow and \(PV_{annuity}=P\frac{1-(1+r)^{-n}}{r}\) for an annuity, determine which option gives the higher present value per hectare.
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About This Question
This is Gce Model Questions Vol1 2024 Agricultural Science Question 13. It is one of the objective questions from the 2024 Gce Model Questions Vol1 Agricultural Science examination.
Difficulty level: Hard .
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