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Discounting [15]

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Bullet points include: Explain type of discount rate being used, how it has been derived, how it allows for risk and purpose of valuation Differentiate between three main liability types: Contractually guaranteed vs. constructive vs. discretionary And between purposes: Solvency: assess assets required to meet liability cash flows in absence of any other supporting financial entity Transaction: assess (fair) value of assets to transact in exchange for liability cash flows Funding: advise on accumulation of assets to meet liability cash flow when we can ignore consideration of likely sufficiency of assets in the interim

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