Box 3–5: Formulas for Net Present Value Method
total mineral reserve value_t_ @_3_ percent discount
rate =
0.88 [p_t_ - a_t_] R_t_ - 0.88 K_t_
total mineral reserve value_t_@10 percent discount rate =
0.69 [p_t_ - a_t_] R_t_ - 0.69 K_t_
additions_t_ @_3_ percent discount rate =
0.84 [p_t_ - a_t_ - K_t_/R_t_] * A_t_
additions_t_ @ _10_ percent discount rate = 0.59 [p_t_ - a_t_ - K_t_/R_t_] *A_t_
depletions_t_@_3_ percent discount rate = 0.83 [p_t_ - a_t_ - K_t_/R_t_] * q_t_
depletions_t_@_10_ percent discount rate} = 0.60 [p_t_ - a_t_ - K_t_/R_t_] *q_t_
revaluations_t_ = V_t_ - V_t-1_ + depletions_t_ - additions_t_
where variables are as defined in Box 3–3.
Note: The numerical values in this box apply to 1987.
As explained in the text, slightly different values will apply for different
years.