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3. Consider a semiannual payment floating-rate security whose coupon rate is determined as: reference rate + 42.5 basis points Assume its term to maturity is

3. Consider a semiannual payment floating-rate security whose coupon rate is determined as: reference rate + 42.5 basis points Assume its term to maturity is 5 years and current price is 99.625. What is the discount margin of the floater if the initial reference rate is 8%? (4 point)

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