Consider a 4-year leveraged inverse floating rate bond with the following coupon rate: c(t) = 24%-2.4*r(t-0.5). This coupon is paid semi-annually, in arrears. So the dollar coupon at each payment date is given by: $coupon = c(t) / 2 * 100. Assume it is Dec. 31, 1993 and use the average of the bid and ask discount factors given in Table 2.7 on page 64 of the text. What is the value of this inverse floater?
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