Question 22 Consider an MNC that is exposed to the Taiwan dollar (TWD) and the...
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Question 22 Consider an MNC that is exposed to the Taiwan dollar (TWD) and the Egyptian pound (EGP). 25% of the MNC's funds are Taiwan dollars and 75% are pounds. The standard deviation of exchange movements is 7% for Taiwan dollars and 1% for pounds. The correlation coefficient between movements in the value of the Taiwan dollar and the pound is 0.51. Based on this information, the standard deviation of this two-currency portfolio is approximately
(answer in 4 decimal places)
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