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By Sabert Oglesby, Albert L. Thomas

Until recently, probably the best means of sampling airborne dusts has been the impinger method. Dust-laden air is drawn into a sampling tube, and the particulate matters separated from the air and collected in the liquid in the impinger. A sample of the suspension is prepared on a slide and counted through a projection microscope. This method is simple and reliable, but it does suffer drawbacks. Since the collected particles must be counted visually, results of the dust count are taken. This seriously impedes studying the effectiveness of dust inhibitors, such as water sprays, or making adjustments in equipment. Greatest disadvantage of all, however, is the tedious task of counting particles in the sample. With the growing desirability of taking more samples, the effort involved in making these counts is a real factor in the cost of dust control. Finally, it is generally recognized that impinger dust counts can be related to health hazard only for specific kinds of dust and under similar conditions. This is because the rather complex mechanism of dust damage depends so much on size distribution of the dust. Counts determined by impinger samples cover a limited size range that does not necessarily correlate with retention by the lungs and upper respiratory tract.

Jan 3, 1959

By Walter Miller

The focus of attention during 1939 was on increasing the octane number of gasoline. The "octane race" resumed full swing. The averagc octane number of house-brand gasoline by the end of the year had easily reached two numbers higher, with several companies in the field actually purveying house-brand gasoline of 78-80 "research" octane number, equivalent roughly to from 74 to 77 A.S.T.M. octane rating, compared with the 70 A.S.T.M. ceiling of two or more years ago. Whether this trend toward much higher octanes is the result or the cause of the many t,echnical developments in the motor-fuel field of recent, years, progress has really been startling. In addition to the advance in catalytic cracking and catalytic re-forming, other important contributions to the technical ability to produce higher octane values include: installat>ions involving increased capacity in thermal re-forming, with improved economic status both as to yields and octane number, by coupling with catalytic polymerization; more widespread adoption of catalytic and thermal polymerization, and a surge toward extensive installations of newly developed alkylation processes for making iso-octane, neo-hexanr and other high antiknock products; and greater use of improved desul-phurization processes, and application of superfractionation methods for segregation of practically pure hydrocarbons with superior octanr qualities from gas and highly volatilc liquids. The approaching of practical limits in the use. of tetracthyl lead (t,hr well-known "law of diminishing returnsn coming into the picture at the higher octane levels being approached) has given impetus to development of the methods listed above. In particular, processes that improve the octane rating and also increase ethyl lcad sc.nsitivity have had considerable study durirlg the year. CatSlytic Re-foRming Although the interesting report on the Houdry catalytic cracking process presented at the annual meeting of the American Petroleum

Jan 1, 1940

By Walter Miller

The focus of attention during 1939 was on increasing the octane number of gasoline. The "octane race" resumed full swing. The averagc octane number of house-brand gasoline by the end of the year had easily reached two numbers higher, with several companies in the field actually purveying house-brand gasoline of 78-80 "research" octane number, equivalent roughly to from 74 to 77 A.S.T.M. octane rating, compared with the 70 A.S.T.M. ceiling of two or more years ago. Whether this trend toward much higher octanes is the result or the cause of the many t,echnical developments in the motor-fuel field of recent, years, progress has really been startling. In addition to the advance in catalytic cracking and catalytic re-forming, other important contributions to the technical ability to produce higher octane values include: installat>ions involving increased capacity in thermal re-forming, with improved economic status both as to yields and octane number, by coupling with catalytic polymerization; more widespread adoption of catalytic and thermal polymerization, and a surge toward extensive installations of newly developed alkylation processes for making iso-octane, neo-hexanr and other high antiknock products; and greater use of improved desul-phurization processes, and application of superfractionation methods for segregation of practically pure hydrocarbons with superior octanr qualities from gas and highly volatilc liquids. The approaching of practical limits in the use. of tetracthyl lead (t,hr well-known "law of diminishing returnsn coming into the picture at the higher octane levels being approached) has given impetus to development of the methods listed above. In particular, processes that improve the octane rating and also increase ethyl lcad sc.nsitivity have had considerable study durirlg the year. CatSlytic Re-foRming Although the interesting report on the Houdry catalytic cracking process presented at the annual meeting of the American Petroleum

Jan 1, 1940

By R. G. Johnson

The prevailing system of locating wells on a rectangular basis, as shown in Fig. 1-A, has developed because of the exigencies of offsetting at boundary lines. When, however, a very large tract is being drilled, it is often possible to abandon this inferior method for the superior arrange- ment known as "staggering," which is illustrated in Fig. 1, B and C. The advantages of the triangular over the rectangular method are evident from Fig. 2, computed on the basis of one well to 10 acres (4 ha.). With the triangular system, no land is more than 409.4 ft. (124.8 m.) from a

Jan 1, 1920

By C. R. Schumacher, W. H. Moyer

Cornwall, Pa. magnetite ore, containing recoverable sulfides in the form of chalcopyrite and pyrite, has been mined continuously since 1742 1 Beneficiation of the ore was begun in 1905, at the Lebanon concentrator located six miles from the mine. At first, only magnetite was recovered, using Grondal magnetic separators. In 1907, copper minerals were recovered by means of Wilfley tables. Copper flotation, attempted as early as 1912, was finally successful in 1919. In 1940, flotation of the cobalt- bearing pyrite was begun, and Cornwall ore became the major domestic source of cobait for many years. In 1916, the Bethlehem Steel Corp. began to purchase interests in the Cornwall mine and Lebanon concentrator properties, and by 1926 had acquired complete ownership. Metallurgical practice at the old Lebanon concentrator was good, but by today's standards the plant was outdated. The flowsheet was complex, due both to the mineral content of the ore and to the low capacities of much of the equipment. As the flowsheet developed, buildings were added and the plant was spread over a relatively large area, with resulting high manpower requirements. Another disadvantage was the six-mile rail haul from the mine to the Lebanon concentrator.

Jan 3, 1966

By Leonard Larson

DURING several years immediately preceding the adoption of wet-charge smelting at McGill, various necessary conditions affecting this procedure, such as plant rearrangement and the metallurgical nature of the concentrate produced at the concentrator, were fully considered. Wet-charge smelting is not altogether novel to the recently recon-structed smelter at McGill. A number of years prior to this improve-ment, when flotation methods were initiated at the concentrator, large tonnages of wet and (at that time) sticky flotation concentrate were charged directly into the reverberatory furnaces, because of the difficulty in handling the entire tonnage in the roasters. The plant had excess reverberatory units and this surplus furnace capacity was utilized to smelt raw flotation concentrate. During the years 1927 and 1928, a number of actual operating furnace test runs were made to determine in principle the feasibility of wet-smelt-ing operation. Results were encouraging, and in November 1932 the roasting plant was shut clown. For some time thereafter the wet feed was delivered directly to the reverberatory side-charging calcine hoppers already in place. Feeding the wet material through the old calcine hoppers and charge holes into the furnace involved considerable labor, but under the conditions existing at that time it was desirable to continue wet smelting even under the handicap of this laborious procedure. The smelting plant during this period was on a curtailed production basis, operating only about 15 days per month. The alternate starting up and shutting clown of the roasting plant presented a difficult problem and charging the wet material directly to the furnace entirely eliminated this difficulty. The roasting plant was never operated thereafter.

Jan 1, 1938

By F. L. Grammer

THE analyses given in Table I. were made several years ado at my request at a plant using Lake ores. The, are of two furnaces, one making basic, the other Bessemer pig-they gave 6 casts each in 24 hr., also two flushes of cinder between each cast. They- are offered simply for the sake of reference as, so far as I know, it is unusual to find so frequent fall analyses made and none are on record. The variations iii manganese-content in the first and second flushes on the basic furnace are interesting, if no more than a freak-the first flash being invariably higher in manganese. The iron-content of the two slugs from an. average of 12 flushes shows: Basic. Bessemer. Per Cent. Per Cent. Total iron 2.55 1.70 Combined iron 0.72 0.52 Free iron 2.13 7.15

Jan 3, 1913

By L. G. Austin

If S (x) is the specific rate of breakage of size x and B (x, y) (see Table 1 for Nomenclature) is the cumulative breakage distribution function, the Herbst Fuerstenau2 assumption is that Inserting this assumption into first-order grinding equations it has been shown" that there are then simple analytical solutions to the grinding equations, as shown in Table 2. In this context "plug flow" is defined as all material passing through the mill in the same length of time, the residence time t. The term "n fully-mixed" means that the mill has a residence time distribution" which can be treated as if the mill were n equal fully mixed sections in series. In addition it has been shown that the assumption of Eq. 1 also leads to simple analytical solutions for closed-circuit, steady-state grinding with an ideal classifier at the mill exit returning oversize to the mill feed. The solutions are also given in Table 2, with µ as the ideal classifier cut size, C the circulation ratio, and Q (x) the size distribution of the circuit product. The specific surface area of these size distributions is where the density-shape factor k. is assumed to be constant with size. In practice, most methods of size analysis or area [ ] measurement have a finite lower limit, so that the integration is really performed from xm, to xm, For a realistic degree of grinding the value of So is dominated by the fine sizes because of the 1/x factor. Consider batch grinding of a feed of size y to y + dy. The batch grinding solution given in Table 2 is then [ ] The fresh surface area produced is the area of the fines plus the area of the original material remaining minus the area of the original material, [ ] Little error is introduced by neglecting the last term on the right-hand side since at t = 0 it is zero, and when t is significant the first term dominates because of the fine sizes produced. In addition, the form of P (x, t) for [ ] realistic values of S (x) 2t ax° is such that the major fraction of fresh surface produced is contained within the bottom 10% of weight of broken material, that is, for sizes for which P(x, t) < 0.1 (providing y is not near x.,). Thus for surface area purposes Eq. 3 can be approximated by [ ] becomes providing again that the feed sizes are coarse relative to xmi. Then the fresh area production is and W is the mass in the mill. The rate of surface production is WK, and the specific surface is Kt. From Table 2, the specific energy is mt/W so surface production per unit energy is [ ] Surface produced per unit energy input = KW/m (8) where m is the energy input of the mill. Clearly, identical reasoning applies to open-cycle, plug-flow grinding, with t replacing t, and Eq. 8 is obtained again. Considering open-cycle, fully mixed grinding, similar reasoning gives P(x) - t S(x) for surface area purposes, and

Jan 1, 1974

By Leonard Larson

DURING several years immediately preceding the adoption of wet-charge smelting at McGill, various necessary conditions affecting this procedure, such as plant rearrangement and the metallurgical nature of the concentrate produced at the concentrator, were fully considered. Wet-charge smelting is not altogether novel to the recently reconstructed smelter at McGill. A number of years prior to this improvement, when flotation methods were initiated at the concentrator, large tonnages of wet and (at that time) sticky flotation concentrate were charged directly into the reverberatory furnaces, because of the difficulty in handling the entire tonnage in the roasters. The plant had excess reverberatory units and this surplus furnace capacity was utilized to smelt raw flotation concentrate. During the years 1927 and 1928, a number of actual operating furnace test runs were made to determine in principle the feasibility of wet-smelting operation. Results were encouraging, and in November 1932 the roasting plant was shut down. For some time thereafter the wet feed was delivered directly to the reverberatory side-charging calcine hoppers already in place. Feeding the wet material through the old calcine hoppers and charge holes into the furnace involved considerable labor, but under the conditions existing at that time it was desirable to continue wet smelting even under the handicap of this laborious procedure. The smelting plant during this period was on a curtailed production basis, operating only about 15 days per month. The alternate starting up and shutting down of the roasting plant presented a difficult problem and charging the wet material directly to the furnace entirely eliminated this difficulty. The roasting plant was never operated thereafter. EARLY PROCEDURE Fig. 1 shows the general layout of the smelting plant before the smelter was remodeled. Under this arrangement, all concentrates and fluxes except converter flux were delivered in cars to wooden storage bins, which paralleled the roaster building. The material to be roasted was dis-

Jan 1, 1938

By Alfred E. Hunt

The technical papers of the last few years give numerous in stances of serious failures by cracking or rupture of soft steel boiler plates, marly of which have satisfactorily passed the rigid inspection and tests required by both Lloyds&apos; Register and the Board of Trade in England. I speak of the inspecting department of Lloyds&apos; and the Board of Trade, for we do not begin to have as systematic and intelligent work regularly done in this country as is done by these institutions in England. Tension-tests of this steel have given from 65,000 to 65,000 pounds per square inch tensile strength, with from 20 to 30 per cent. elongation in 8 inches. Chemical analyses have shown the steel to contain from 0.12 to 0.15 per cent. carbon, from 0.25 to 0.40 per cent. manganese, and from 0.03 to 0.05 per cent. phosphorus. All of these tests are considered normal, and, in the words of one of our members, " boiler-plates with these qualities ought not to fail." There are, however, several causes of failure in soft steel plates which, although the writer does not presume to ascribe to then], or either of them, any particular instance, are still dangerous, and ought to be guarded against much more carefully than in usual present practice. These causes are: 1. The hardening property of all steel. 2. Insufficient work from the ingot to the finished plates. 3. Temporary fiber in certain steels. 4. Internal strains caused by unequal work upon the material. Hardening.-The writer, in a paper read before the Institute in October, 1883," made the statement that soft .steel, no matter how low in carbon, would harden to a certain extent upon being heated red-hot and plunged into water, and that it hardened more when plunged into brine and less when quenched in oil, and gave the results of one experiment, merely as an illustration of many which had all confirmed the statement made. The illustration was a heat of open-hearth steel made by the . writer, of 0.15 per cent. carbon and 0.29 per cent. of manganese, which gave (he following results upon test-pieces from the same 1/4-thick plate.

Jan 1, 1886

By N. G. W. Cook

At present, tunnels can be driven in rock by either of two essentially different techniques, in one of which rock-breaking is accomplished by drilling and blasting and in the other by mechanical loading. The methods based on these techniques are comparable in terms of the rates at which tunnels may be advanced, although they differ widely in their range of applicability to different types of rock and lengths of tunnel. The method based on drilling and blasting has reached a high degree of development. It is applicable to even the hardest rocks and rates of advance in excess of 50 ft per day (fpd) are attainable. The main disadvantages of this method are that it involves a sequence of operations punctuated by blasting and that it is relatively uncontrolled, resulting in overbreaking the tunnel profile and damage to the surrounding rock. However, its flexibility, mobility, and low capital cost constitute real advantages in many situations, such as those involving short lengths of tunnel or low rates of advance. Tunneling machines based on mechanical breaking of the rock are a more recent development. They offer a continuous and controlled means of tunneling capable of rates of advance in excess of 100 fpd under favorable conditions. However, these machines weigh many tens of tons and consume several hundred horsepower, so that they are costly and lack mobility. At present, their applicability is limited to long tunnels in relatively soft rock where the high rates of advance and tunnel quality can offset their onerous capital cost. Many situations exist in which the superior quality of a machined tunnel and freedom from blasting would be real advantages, but where the rock is either too hard for existing machines or the length of the tunnel does not justify their capital cost: What are the possibilities of developing cheaper, more flexible, and mobile tunneling machines? Most existing tunneling machines fragment all the rock at the tunnel face to facilitate its disposal. If a machine were used to cut only the profile of a tunnel as one of a sequence of operations, it would be required to break

Jan 1, 1970

The Commissioner of Education has issued a call for a public conference on business training for engineers and engineering training for students of business. This conference, national in scope and character fully representative of all interests, will be held in Washington, D. C. on June 23 and 24. Educational institutions, commercial organizations, and educational and engineering societies will be given an opportunity to state their views. Engineers, educators and business men will be invited to discuss the following major topics: Business Training for the Engineer; Engineering Training for Commercial Enterprises; Significance of the. War Experience for Engineering Education; Training of the Engineer for Foreign Projects. This conference has been called on behalf of the Conference Committee on Commercial Engineering. This Committee is composed of administrative professors in engineering and commerce from several of the large educational institutions and representatives from the American Institute of Mining and Metallurgical Engineers, Society for the Promotion of Engineering Education, The American Society of Civil Engineers, American Institute of Electrical Engineers, American Society .of Mechanical Engineers, and a committee f fifteen on Educational Preparation for Foreign Service.

Jan 6, 1919

By W. Myron Davy

For more than a decade the use of the metallographic microscope, by mining geologists, for examining ores has been increasing and conclusions founded upon examinations made by it are found in several recent professional papers of the United States Geological Survey as well as in our technical publications. But most mining men have been slow to realize the positive value of this instrument in their daily work. The reason for this condition is not hard to find. The varied applications, the simplicity of preparation, and the methods of studying a polished section of ore have not been widely published. Papers in technical periodicals have been profusely illustrated by photographs of such sections, special refined methods of procedure for laboratory work have been described, and complete and detailed schemes of identifying the ore minerals have been published in book form.1 But simple and easily applied directions and, what, is more important, light, compact, and inexpensive equipment have not been available. The simplest microscope obtainable is intended for laboratory use and is much too bulky for the average field equipment; at present it costs about one hundred dollars for the instrument alone. Methods previously described for polishing specimens have necessitated electrically driven lap wheels, which are found only in permanent installations. It is small wonder that the examining mining engineer, field geologist, resident engineers, and mill men have looked upon the subject as being too involved for the field and have assigned it to the laboratory investigator. The writer has been interested in this question for some time from the viewpoint of his own work. Being handicapped by the difficulties enumerated, he has designed an outfit that has proved very useful. It is described here and its. applications shown in the hope that it may be of equal value to others, and that a start will be made toward popularizing

Jan 8, 1920

[PRESIDENT AND DIRECTOR * R. R. McNAUGHTON, &apos;63, Trail, B. C., Canada PAST-PRESIDENT AND DIRECTOR * JOSEPH L. GILLSON, &apos;62, Wilmington, Delaware PRESIDENT-ELECT AND DIRECTOR * LLOYD E. ELKINS, &apos;64, Tulsa, Oklahoma VICE-PRESIDENTS AND DIRECTORS * JOHN S. BELL, &apos;62, Houston, Texas * A. B. CUMMINS, &apos;62, Bound Brook, New Jersey * WAYNE E. GLENN, &apos;62, Houston, Texas * C. C. LONG, &apos;62, Monaca, Pennsylvania * J. S. SMART, JR., &apos;63, New York, New York * J. W. WOOMER, &apos;62, Pittsburgh, Pennsylvania]

Jan 1, 1961

By Benjamin Petkof

The mineral mica, which has been known to man since ancient times, has played an impor¬tant role in the development of our modern industry. In the latter part of the 19th century sheet mica began finding use as a dielectric insulating material in the newly developing electrical industry. Later, when modern elec¬tronics began to develop, it became a vital insulating and dielectric material for use in electronic equipment. Both the electrical and electronic industries were greatly dependent on some form of natural mica. The manufacture of electric motors of varying sizes, electronic tubes, and other electronic items was dependent on an adequate supply of sheet mica. During World War II this material was so vital to national defense that special efforts were made to mine it in the United States as well as to obtain it from overseas mica-producing areas. However, advancing technology has successfully begun the progressive development of man-made mica-based and non-mica-based materials that can replace mica for many uses. In addition, developing technology has dictated changes that have made sheet mica unnecessary for some uses. As the demand for sheet mica declined, the demand for scrap and flake mica has continued to increase. In fact, today the domestic production and use of scrap and flake mica far outshadows the necessity for good¬quality sheet mica in this country. Historically the United States has always been dependent on foreign sources of material for good-quality sheet mica and imports practically its entire requirement. In the case of scrap and flake mica, the United States is the dominant world producer and consumer. End Uses Sheet mica (Chowdhury, 1941; Rajgarhia, 1951; Skow, 1962) is available in many com¬mercial forms, but these forms can be broadly classified into manufactured and unmanufac¬tured mica. Manufactured mica consists of mica that has been shaped, punched, or other¬wise processed into some form, suitable for a particular end use. Unmanufactured mica con¬sists of partially hand-trimmed or processed material that has not been prepared for any particular end use. Unmanufactured mica is broken into two commercial classes consisting of sheet mica and scrap and flake mica. These classes of mica differ greatly in their ultimate end uses and marketed forms. Sheet muscovite mica can be classified by color, degree of prep¬aration of the crude material, thickness, size, visual appearance, and electrical quality. In addition, phlogopite mica is also classified by its thermal stability. Scrap and flake mica consist of mine, trimming shop, and factory scrap that occurs as remnants from mining, processing, and manufacturing operations, and small particle size mica that is available from the beneficiation of pegmatites, clays, schists, or other mica-rich host rock. The end uses for sheet mica vary so greatly from those of scrap and flake mica that it is necessary to discuss them separately. Sheet Mica Sheet mica consists of relatively flat sheets of material which have been mined as naturally occurring books or runs of mica. These sheets are hand-trimmed to remove any imperfections and are punched or stamped into specified shapes for industrial use. Sheet mica can be further processed and is described or specified as block, film, or splittings based on thickness. Block mica is not less than 0.007 in. thick with a minimum usable cross-sectional area of 1 sq in. Film mica is split from the better quali¬ties of block mica to specified thickness groups ranging from 0.0012 to 0.004 in. Splittings are sheets of mica with a maximum thickness of 0.0012 in. and a minimum usable area of 0.75 in. Other small sized, lower quality block mica

Jan 1, 1975

By Douglas R. Cook

The urgent need for new base metal ore discoveries was discussed by various authoritative exploration personnel at a CIM symposium on the future of the Canadian mineral industry held at Ottawa in 1967. Data presented at this meeting showed that approximately 150 new mines have started or restarted production in Canada since 1955. Over half of these mines were discovered prior to 1950. The distribution of Canadian ore discoveries during the last 15 years (shown in Fig. 1) illustrates a striking reduction in the discovery rate in recent years in spite of increasing exploration expenditures. These data indicate that $20 million is now spent in exploration for every significant metal deposit found, and evidently the cost of discovery is still rising. Even fewer discoveries are being made in some other important continental areas of the world such as Africa, Australia and South America. The discovery record in the U.S. is thought to be more rewarding than in Canada because the new deposits appear to be substantially larger. Fortunately, most good base metal ore deposits have attractive investment re- turns to justify large exploration expenditures. The magnitude of the exploration expenditures and the increasing need to develop additional metal resources justifies a critical review of the procedures used in the search for ore deposits. Of particular concern is the need to improve the use of exploration techniques in the attempt to obtain better discrimination and efficiency. There is a tendency by inexperienced exploration groups to think of any geological, geochemical or geophysical anomaly as an exploration target and ignore the fact that anomalies can result from many factors other than economic concentration of metals. The desire for a unique and favorable explanation of exploration data often results in too rapid a movement from the reconnaissance to the drilling stage without the use of all the relevant information.

Jan 7, 1968

By H. A. Wilmeth

IN 1955, before planning an accelerated stripping program, Chino Mines Div. began an engineering study to improve data for estimating truck haulage costs for any future haulage layout. The study aimed to develop: 1) significant unit costs, 2) a method of estimating travel time from which truck needs and future stripping rate could be determined, and 3) yardsticks of performance to measure haulage efficiencies. It was suggested that to provide significant unit costs, expense accounts should offer management two types of cost control information-unit cost yardsticks with which monthly unit costs could be compared and unit costs for estimating future expenses for any haulage layout.

Jan 5, 1958

By P. Sen, H. B. Barani, P. Sen Gupta

A critical review of the various separation efficiencies reported in literature has been made. Most of the relationships used for evaluating the performance relate to screening, classification, or concentration operations and are applicable to single-stage, two-component systems only. In the present work, a much simpler approach has been used for assessing the separation process irrespective of the type of operation and this has been extended further to obtain an expression for a multicomponent feed and multiproduct (from a multistage operation) system.

Jan 1, 1980

By William P. Lohden

INTRODUCTION It is recognized that, for a variety of reasons, some companies in the mineral industry today are by no means cash-rich and, in fact, are reporting a growing proportion of long-term debt in their capital structures. A review of recent balance sheets of small, medium-size, and some larger companies, indicates that a fair number still have substantial positions in cash equivalents such as U.S. government issues and other short-term money market instruments. In part, this paper concerns itself with companies which have sufficient cash and equivalents and/or cash generation to internally finance mining projects or expansions but which, for some reason, choose to borrow funds. Misconceptions which appear to frequently underlie so-called "leveraging" decisions are explored in this paper. Also considered arc&apos; those circumstances under which any company, including one that is cash rich, should consider borrowing for a project in an amount beyond what would otherwise be necessary based upon its internal financing ability. I do not attempt to cover the raising of equity capital in public markets in this paper. OVERALL RETURN ON INVESTABLE CASH If you approach an individual with an investment which can be financed from savings, or by borrowing at a rate higher than one is earning on savings, that individual will quickly tell you that to pay interest at a rate higher than is being earned on savings would reduce overall income. Assuming that additional investment opportunities are not currently being considered, the individual concludes that a draw-down on savings, leaving a cushion for contingencies suited to individual circumstances, is the correct financial decision. For reasons discussed later, the simple mathematical logic leading to this conclusion tends to become obscured at the corporate level. When Leveraged Studies Are Inappropriate or Premature Surprisingly, I have heard of a number of companies that could afford to finance an investment solely with internal funds, which have made DCFROR (i.e. discounted-cash-flow rate-of-return) studies not only on a 100% equity basis but also on a leveraged basis. Certainly, a leveraged study would be appropriate if additional projects were competing for more capital than was available internally. Often, however, other projects are not far enough along to warrant a leveraged study and there is some danger that a project may be undertaken because it has an estimated acceptable rate of return, on a leveraged basis, that is not ultimately earned because some of the other projects are postponed or abandoned and borrowing is less than expected. For the above reasons, until it has been determined that (1) borrowing is a reasonable certainty for a particular project and (2) the timing and amount to be borrowed has been determined within a reasonable range of accuracy, I believe it is inappropriate and misleading to calculate DCFROR for a project other than on a 100% equity basis. Even when there are several projects currently competing for funds and borrowing will be required to finance one or more of them, using the common yardstick of calculating DCFROR on a 100% equity basis is a safer method to initially evaluate and compare the attractiveness of the projects. Many companies, whether they would have to borrow or not, will reject projects that on a 100% equity basis do not meet their minimum rate of return standards. Some companies which have to borrow will undertake a project provided the project&apos;s DCFROR on a leveraged basis meets its minimum return standards. The danger of this approach is that even moderate shrinkages of estimated cash flows could plunge return below

Jan 1, 1985

Albin, B. R Billings, Mont. &apos;28 Amster, Nathan L 25 Broad St., New York, N. Y. &apos;28 Bache, Jules S 42 Broadway, New York, N. Y. &apos;28 Barrett, C. P 5338 Harper Ave., Chicago, 111. &apos;28 Bayless, William S Russ Bldg., San Francisco, Cal. &apos;28 Bean, Louis, H 60 E. 42nd St., New York, N. Y. &apos;28 Beatty, Ross J Room 604, 6 N. Clark St., Chicago, III. &apos;28 Benwell, Oswald F Hold Mags. &apos;28 Beymer, Albert S., V.P., Keystone National Bank Pittsburgh, Pa. &apos;28 Blumenthal, Hugo 44 Pine St., New York, N. Y. &apos;28 Boettcher. Charles Ideal Cement Bldg., Denver, Colo. &apos;28 Bowlus, Thomas H., Banker, Pres., Allen County State Bank Iola, Ran. &apos;28 Brown, Colvin B Chamber of Commerce, Washington, D. C. &apos;28 Burt, Maxwell Struthers Southern Pines, N. C. &apos;28

Jan 1, 1936