Table:
|  |  | August 31, 2019 |  | August 31, 2018 |  |
| --- | --- | --- | --- | --- | --- |
| (in thousands) | Fair Value Hierarchy | Carrying Amount | Fair Value | Carrying Amount | Fair Value |
| Notes payable and long-term debt: (Note 8) |  |  |  |  |  |
| 5.625% Senior Notes | Level 2(1) | $398,886 | $416,000 | $397,995 | $415,704 |
| 4.700% Senior Notes | Level 2(1) | 498,004 | 525,890 | 497,350 | 503,545 |
| 4.900% Senior Notes | Level 3(2) | 299,057 | 318,704 | 298,814 | 306,535 |
| 3.950% Senior Notes | Level 2(1) | 494,825 | 509,845 | 494,208 | 476,010 |
Paragraphs:
Fair Value of Financial Instruments
The carrying amounts of cash and cash equivalents, trade accounts receivable, prepaid expenses and other current assets, accounts payable and accrued expenses approximate fair value because of the short-term nature of these financial instruments. The carrying amounts of borrowings under credit facilities and under loans approximates fair value as interest rates on these instruments approximates current market rates.
Notes payable and long-term debt is carried at amortized cost; however, the Company estimates the fair value of notes payable and long-term debt for disclosure purposes. The following table presents the carrying amounts and fair values of the Company’s notes payable and long-term debt, by hierarchy level as of the periods indicated:
(1) The fair value estimates are based upon observable market data.
(2) This fair value estimate is based on the Company’s indicative borrowing cost derived from discounted cash flows.
Refer to Note 9 – “Postretirement and Other Employee Benefits” for disclosure surrounding the fair value of the Company’s pension plan assets.
Question:
What were the Level 3 fair value estimates based on?
Answer: the Company’s indicative borrowing cost derived from discounted cash flows.