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Exhibit 3: Discounted Expected Cash Flows Per Concepts Statement no. 7
  Asset A Asset B Asset C Asset D Asset E Asset F
Contractual (promised) cash flow $60,000 $60,000 $60,000 $60,000 $60,000 $60,000
Expected cash flow $60,000 $50,000 $60,000 $46,000 $60,000 $55,445*
Adjustments to reflect risk premium   $200   $1,500   $1,400
Adjusted cash flows $60,000 $49,800 $60,000 $44,500 $60,000 $54,045*
Present value at 6% (risk-free rate) $60,000 $49,800 $42,300† $31,372†† $49,170 $44,314*
* See exhibit 4
† $60,000 5 .705
†† $44,500 5 .705
$10,000 5 4.917

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