SAF Policy, Economics & Administration 3

Question 1

The Faustmann formula in forest economics determines the rotation age that maximizes:

Accepted Answer

Land Expectation Value across an infinite series of rotations

Answer

The Faustmann formula calculates the Land Expectation Value (LEV) — the present value of bare forest land under an infinite series of optimal rotations.

Question 2

Which non-market valuation method estimates environmental values by analyzing how property prices vary with nearby environmental conditions?

Accepted Answer

Hedonic pricing

Answer

Hedonic pricing uses variation in property or wage markets to reveal how much people implicitly pay for environmental amenities such as proximity to forests or clean air.

Question 3

In forest economics, 'existence value' refers to the value people place on a resource:

Accepted Answer

From knowing the resource exists even if they never use it

Answer

Existence value (also called passive use value) is the value individuals derive simply from knowing that a resource exists, independent of any actual or planned use.

Question 4

Price elasticity of timber supply measures:

Accepted Answer

How responsive the quantity of timber supplied is to changes in stumpage price

Answer

Price elasticity of supply measures the percentage change in quantity supplied relative to the percentage change in price, indicating how sensitive timber markets are to price signals.

Question 5

Which type of externality most commonly results from private timber harvesting on steep slopes near streams?

Accepted Answer

Negative externality from increased downstream sedimentation and water quality degradation

Answer

Harvest-related road construction and soil disturbance on private lands frequently impose downstream sedimentation costs on water users who do not compensate landowners for them.

(SAF) Society of American Foresters Certification Practice Test

(SAF) Society of American Foresters Certification Practice Test

SAF Policy, Economics & Administration 3