FORE316 Old exams

What are the advantages of using croptypes?

Simplifies planning, less yield info, smaller models, faster turnaround, easy what-if analysis, clearer big-picture focus.

What are the disadvantages of using croptypes?

Loss of detail, assumes same yield for all stands in a croptype.

How does variable resolution croptyping reduce disadvantages?

Aggregates young stands, keeps older stands unique, balances short-term detail with long-term outcomes.

What is volume control?

Brings unregulated forest to regulated by specifying constant harvest volume during transition.

Main advantage and disadvantage of volume control?

Advantage: constant yield; Disadvantage: may not achieve target normal forest.

What is the Equivalent Normal Forest (ENF)?

A unique normal forest achievable from current age-class distribution, provides benchmark not target.

What does ENF Volume represent?

Constant annual harvest that converts current forest into a normal forest.

What are traditional measures of forest mass and maturity?

Forest mass = growing stock volume; Maturity = average stand age.

What are the 5 age-class structures and key yield regulation issues?

Young: when to start harvest, cashflows. Narrow: block vs NDY. Regular: straightforward. Old: realise overmature stands. Irregular: handle fluctuating areas.

What is a static balance forest?

Equal area each age class, equal harvest annually, constant yield.

Why was static balance the yield regulation goal?

Ensured constant harvest and supply stability.

Why shift to imbalanced forest management?

Forests always in transition: sales, purchases, planting, rotation changes, events, climate, laws.

What is current focus of yield regulation?

Outputs: maximise NPV, maintain cashflow, wood supply continuity, harvest near optimal ages.

When are optimisation models routinely used?

Long-term, medium-term, annual planning.

When are optimisation models used less?

Weekly/daily planning.

Why limited optimisation in short-term?

Data hard to update, precision low, qualitative factors, frequent changes.

What 3 issues ensure forest value realisation?

1. Best markets. 2. Decide stands, crew, cross-cutting. 3. Ensure cut-plan applied correctly.

How do superskids/processing yards change decision links?

Split market/stand choice from cross-cutting, link last two decisions together.

Define log-making vs marketing loss.

Log-making: poor cross-cutting. Marketing: excluded higher-value grade from cut-plan.

How do superskids/processing yards reduce losses?

Log-making: better data, skilled log-makers. Marketing: more log grades in cut-plan.

What are 3 forms of the income approach?

Expectation (DCF), Immediate liquidation, Option pricing.

Why are immediate liquidation and option pricing not routine?

Liquidation ignores impacts and gives 0 to young stands. Option pricing requires complex log price models.

Which income approach is used in practice?

Expectation (DCF): forecast cashflows discounted to value.

When is cost approach used?

Young forests where DCF gives negative values.

Why isn't sales comparison sole method?

Forests heterogeneous, few sales, point-in-time data, little public info.

How is transaction evidence used?

Calibrate implied discount rate for DCF.

How model catastrophic windthrow in valuation?

Run scenarios, assign probabilities, calculate expected value.

What assumptions are needed for windthrow modelling?

Probability, severity, salvage level and quality, extra costs, price effects.

What other approaches account for windthrow?

Include insurance costs or adjust discount rate.

What is a Kyoto plantation?

Post-1989 forests on non-forest land as at 31 Dec 1989.

What was the 2007 age-class distribution of Kyoto plantations?

Narrow, young stands.

What were benefits of Kyoto plantations?

Carbon sink until ~2020, increased stocks used for NZ obligations.

What were liabilities of Kyoto plantations?

Narrow structure, harvest → carbon source, liabilities after 2020.

Why recommend 380,000 ha afforestation 2021-2035?

Needed sequestration to meet NZ 2050 carbon neutrality goal.

Ethics spray programme: what should you do?

Use mechanical control, prioritise neighbour safety and ethics, communicate transparently.

What were on-truck prices for Berwick SLOG?

80 (sawmill), 30 (pulpmill), 60 (export).

What were on-truck prices for Berwick PULP?

30 (pulpmill).

What were on-truck prices for Otago SLOG?

70 (sawmill), 40 (pulpmill), 50 (export).

What were on-truck prices for Otago PULP?

40 (pulpmill).

Where were logs allocated in unconstrained model?

Berwick SLOG → sawmill, Berwick PULP → pulpmill, Otago SLOG → sawmill, Otago PULP → pulpmill.

What was optimal rotation age of 8 stands?

30 years or less.

Why did NPV fall in even-flow model?

Some stands harvested older than optimal.

Supply to sawmill and export market in 3 years?

Sawmill: 55k, 50k, 55k m³; Export: 0 all years.

What happened to NPV in pulp10 model?

Stayed $12.3m.

Why did pulp10 not affect NPV?

Constraint redundant - already supplied ≥10k m³ pulp/year.

What happened to NPV in pulp50 model?

Decreased.

Why did pulp50 reduce NPV?

Had to send SLOG to pulpmill at pulp price (opportunity cost).

What was recommendation for pulp50 request?

Do not agree unless pulpmill prices increase until NPV neutral.

What are broad objectives of communication?

Exchange info, build relationships, coordinate activities.

What are objectives of communicating widely in change?

Build awareness, reduce resistance, create buy-in, align stakeholders.

What 3 skills enable leaders to delegate effectively?

Trust, clarity in instructions, support/feedback.

What are 3 characteristics of effective teams?

Clear goals, trust, complementary skills.

What are 2 types of resistance in Kubler-Ross model?

Active resistance (e.g. sabotage), Passive resistance (e.g. withdrawal).

How to overcome team resistance?

Engage team, communicate, provide support.

What 3 hygiene factors avoid dissatisfaction (Herzberg)?

Salary, working conditions, job security.

What 3 actions improve team time management?

Prioritisation, delegation, scheduling.

What are stand-level models used for?

Options for each stand: silviculture scheduling, alternative regimes, optimal rotation age.

What are forest-level models used for?

Plan for whole estate with commitments and constraints; management and investment strategy.

When is stand-level analysis sufficient?

Small woodlots, few stands, no resource limits, no yield regulation.

Why combine stand and forest-level models?

Stand-level generates yield tables and options, forest-level integrates into estate-wide strategy.

What is a static balance forest (normal forest)?

Equal area in each age class, equal annual harvest, constant yield.

Why was static balance forest once the goal?

Ensured constant harvest and stable supply.

Why shift to managing imbalanced forest structures?

Forests are dynamic; sales, purchases, planting, species change, markets, climate, law.

What is current focus of yield regulation?

Maximise NPV while ensuring cashflow, continuity of supply, and near-optimal harvest ages.

What factors influence yield regulation approach?

Company objectives, constraints, estate scale, current age-class structure.

Why can't sales comparison be the sole valuation method?

Forests heterogeneous, few sales, point-in-time data, limited public info.

How is transaction evidence used in valuation?

Used to derive implied discount rate for DCF approach.

Why is DCF a blend of sales and income approaches?

Uses transaction data to calibrate income model discount rate.

What determinants affect forest value in DCF?

Species, age, distance, productivity, silviculture, terrain, infrastructure, contracts, ETS, region.

What is the forest planning hierarchy?

Long-term, medium-term, short-term, annual models linked for coherent decisions.

Trends as planning horizon shortens?

Finer time units, more detailed resource and market info, spatial/logistics/environment constraints increase.

How is Monte Carlo used in forest valuation?

Draw random prices, calculate forest value repeatedly, generate distribution of values.

What does Monte Carlo show?

Uncertainty in forest value.

What is Monte Carlo's limitation?

Results depend on assumed distribution and parameters.

What are steps in breakeven analysis?

Test sensitivity to inputs, find input change causing decision switch, assess likelihood of change.

What issue in breakeven for pruning?

Future pruned vs unpruned log price differential.

What issue in breakeven for thinning stocking?

Future large vs small log prices.

What does 'sales drive cut-plans' mean?

Select cut-plans to meet immediate market/customer requirements.

How is weekly production planned?

Crew input + estimates, tally expected production vs orders, adjust cut-plans.

What does 'best cut-plans drive sales' mean?

Use unconstrained/preharvest data to identify optimal cut-plans, inform future sales.

What is ETS averaging?

Carbon earned up to long-term average, tradable without surrender if replanted; reduces carbon price risk.

Ethics dilemma: logging immature stand - what should you recommend?

Advise waiting to maximise client's return, despite pressures.

What NZIF ethics principles apply here?

Act in client's best interest, integrity, avoid conflicts of interest.

What legal obligations apply under 2020 Act?

Must act as adviser, not trader; protect client's interests and safety.

How would you describe the forest's age-class distribution?

Old, mature/over-mature stands.

How much area harvested in year 1?

500 ha.

How much volume harvested in year 1?

200,000 m³.

What was average clearfell age in year 1?

11 years.

How much area harvested in year 2?

100 ha.

How much volume harvested in year 2?

35,000 m³.

What was average clearfell age in year 2?

10 years.

Why did NPV reduce under NDY?

Harvesting at non-optimal ages, over-mature stands spread out, further from optimum.

What happens to NPV in even-flow model?

Same as NDY; already even-flow.

What adjustment could reduce NPV loss in model?

Split NDY or allow small decreases; enable early harvest of over-mature stands.

Critical yield regulation action for Euc Forest?

Allow early harvest of old stands, higher initial volume.

Why might people resist change?

Fear of unknown, loss of control/resources.

How to overcome resistance?

Communication, involvement, support.

Why do individuals form groups?

Social needs, shared goals.

What are two team stages before performing?

Storming (conflict) and Norming (cohesion).

Benefits of leader seeking involvement?

Better decisions, increased buy-in.