A one percent change in assumed health care cost trend rates would have the following effects: 1% Increase 1% Decrease Effect on total of service and interest cost  components of net periodic  postretirement health care benefit cost $— $ — Effect on the health care component  of the postretirement benefit obligation $5 $(5) Postretirement Pension Benefits Health Care Benefits 2003 2002 2003 2002 Discount rate 6.25% 7.00% 6.25% 7.00% Average assumed rate  of compensation increase 3.25% 4.00% n/a n/a Postretirement Pension Benefits Health Care Benefits 2003 2002 2003 2002 Discount rate 7.00% 7.25% 7.00% 7.25% Expected long-term rate  of return on plan assets 8.50% 9.00% n/a n/a Average assumed rate  of compensation increase 4.00% 4.25% n/a n/a Pension Postretirement Benefits Health Care Benefits 2004 $ 59 $ 8 2005 62 9 2006 66 9 2007 70 10 2008 75 10 2009—2013 475 57 (millions) 37 Additional Information Our pension plan weighted average asset allocations at October 31, 2003 and 2002 by asset category are as follows: The amortization of any prior service cost is determined using a straight-line amortization of the cost over the average remaining service period of employees expected to receive benefits under the plan. Weighted average assumptions used to determine benefit obligations at October 31: Our asset allocation strategy for 2004 targets 55 percent in equity securities, 25 percent in debt securities, 5 percent in real estate and 15 percent in other assets. Equity securities include our common stock in amounts substantially less than 0.5 percent of total plan assets at October 31, 2003 and 2002. Other assets includes private equity, mezzanine and distressed debt and timber. Our expected long-term rate of return assumptions as of October 31, 2003 are 8.5 percent, 5.5 percent, 7.0 percent and 10.0 percent for equity securities, debt securities, real estate and other assets, respectively. The following benefit payments, which reflect expected future service, as appropriate, are expected to be paid: Our rate of return on qualified plansGLYPH<213> assets has averaged 5.4 percent and 9.6 percent per year over the 5-year and 10-year periods ending October 31, 2003 (our measurement date). After that date, we reduced our expected long-term rate of return on plansGLYPH<213> assets to 8.0 percent per year. An increase in the cost of covered health care benefits of 6.0 percent was assumed for 2003 and 2004. The rate is assumed to remain at 6.0 percent in the future. The health care cost trend rate assumption may have a significant effect on the amounts reported. Given the qualified pension plansGLYPH<213> funded position, we are not required to make any contributions in 2004. In similar situations in the past, we have chosen to make discretionary contributions for various purposes, including minimizing Pension Benefit Guaranty Corporation premium payments and maintaining the fully-funded status of the plans. In 2004, such discretionary contributions could range from $0 to $200 million. We expect to make contributions in the range of $5 million to $15 million to our other postretirement benefit plans in 2004. Weighted average assumptions used to determine net periodic benefit cost for years ended October 31: Contributions Estimated Future Benefit Payments Assumptions Asset Category 2003 2002 Equity securities 56% 54% Debt securities 26 24 Real estate 5 5 Other 13 17 Total 100% 100% Net Pension and Postretirement Health Care Benefits Expense Postretirement Pension Benefits Health Care Benefits (millions) 2003 2002 2001 2003 2002 2001 Service cost benefits  earned during  the period $74 $58 $50 $2 $2 $2 Interest cost on  projected benefit  obligation 75 75 69 8 8 8 Expected return  on assets (114) (108) (89) — — — Recognized losses 18 10 1 1 1 — Recognized prior  service cost (7) 1 1 — — — Settlement/curtailment  charges — (12) — — — — Total $46 $24 $32 $11 $11 $10