The cost of the land depends on its location and can vary by a 30-50% cost factor between a rural area and a highly industrialized one. The value of land does not decrease with time and is therefore not included in fixed investment when annual cost of depreciation is calculated. Although land does involve capital investment, it is usually preferred to include in fixed capital only those items for which depreciation is allowed by law, thus excluding land. In average, land costs for industrial plants amount to 4-8% of the purchased equipment cost or 1-2% of total capital investment (Peters and, Timmerhaus, 1978).