=+On the other hand, events may not turn out as well as RJW's estimates. There is a 20 per cent probability that the cash flows will be as shown in Table 3.

Table 3: A more pessimistic scenario (excluding purchase cost of mines)

Time t 0

1 2

3 4

5 and all subsequent years Sales (Em) (cash inflows)

1,166.67 1,216,7 1,266,67 1,144 1,170 Less operating costs

(Em)(cash outflows)

1,070 1,105 1,150 1,165 1,150 Net cash flows (Em)

96.67 111.7 116.67

-21 20 Assume