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(3) the average discount of the sample funds. The resulting
discount factor is 9.96 percent, which we round up to 10 percent.
b. Municipal Bond Portfolio
Both Mr. Frazier and Dr. Bajaj determine the minority
interest discount factor for MIL’s municipal bond portfolio by
reference to publicly traded, closed end municipal bond
investment funds. Once again, they disagree on measurement
dates, sample funds, and representative discounts within the
range of the sample fund discounts.
(1) Measurement Date
Mr. Frazier calculates discounts for his sample closed end
municipal bond funds on the basis of January 11, 1996, trading
prices and December 25, 1995, NAV data. Dr. Bajaj utilizes
trading prices and NAV information as of the valuation date;
i.e., January 12, 1996. We agree with Dr. Bajaj that, to the
extent possible, data from January 12, 1996, should be utilized
in determining discounts with respect to the sample funds.
(2) Sample of Funds
Mr. Frazier derives his sample of closed end municipal bond
funds from the list of municipal bond funds set forth in
Morningstar’s Mutual Funds Guide. In his direct testimony, Mr.
Frazier indicates that he excluded from consideration funds that
were “heavily weighted toward a specific sector” and funds with
scheduled liquidation dates. With regard to the first screening
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