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The sign-exponent-mantissa nature of IEEE format means (basically by design) that you have a much finer resolution near 0 (smaller absolute value) than you do away from 0 (larger absolute value).

We're talking about sin(x) with x ~ pi. In this situation the output's absolute value is much much smaller than the input's absolute value. So the output will have much finer resolution than the input.

The output being appreciably non-zero comes from the output having much higher resolution than the input. The output wouldn't be anywhere near small enough to be subnormal.



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