flow is $105.40- the final coupon payment of $5.40 plus the maturity value of $100. Different assumed margins appear at the top of the last five columns. The rows below the assumed margin indicate the present value of each periods cash flow for that particular value of assumed margin. Finally, the last row gives the total present value of the cash flows for each assumed margin.   EXHIBIT 7.2 Calculation of the Discount Margin for a Floater   Floater: Maturity = 6 years Coupon rate = Reference rate + 80 basis points Resets every 6 months Maturity value = $100     (1) (2) (3) (4) (5) (6) (7) (8) Rate Flow Assumed Margin Period (%) ($)* 80 84 88 96 100   1 10 5.40 $5.1233 $5.1224 $5.1214 $5.1195 $5.1185 2 10 5.40 4.8609 4.8590 4.8572 4.8535 4.8516 3 10 5.40 4.6118 4.6092 4.6066 4.6013 4.5987 4 10 5.40 4.3755 4.3722 4.3689 4.3623 4.3590 5 10 5.40 4.1514 4.1474 4.1435 4.1356 4.1317 6 10 5.40 3.9387 3.9342 3.9297 3.9208 3.9163 7 10 5.40 3.7369 3.7319 3.7270 3.7171 3.7122 8 10 5.40 3.5454 3.5401 3.5347 3.5240 3.5186 9 10 5.40 3.3638 3.3580 3.3523 3.3409 3.3352 10 10 5.40 3.1914 3.1854 3.1794 3.1673 3.1613 11 10 5.40 3.0279 3.0216 3.0153 3.0028 2.9965 12 10 105.40 56.0729 55.9454 55.8182 55.5647 55.4385   Presentvalue= $100.00 $99.8269 $99.6541 $99.3098 $99.1381     * For periods 1-11: Cash flow = 100(Reference rate + 80 basis points) (0.5) For period 12: Cash flow = 100(Reference rate + 80 basis points) (0.5) + 100 Floating-RateSecurities 117     For the five assumed margins, the present value of the cash flows is equal to the floaters price ($99.3098) when the assumed margin is 96 basis points. Accordingly, the discount margin on a semiannual basis is 48 basis points and correspondingly 96 basis points on an annual basis. (Notice that the discount margin is 80 basis points (i.e., the quoted mar- gin) when the floater is selling at par.)