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Homework answers / question archive / MCGG is Australian MNC that exports cricket equipment to Asia
MCGG is Australian MNC that exports cricket equipment to Asia. MCGG has exposure to both the Indian Rupee (INR) and the Pakistani Rupee (PKR). 60% of the MCGG's funds are INR and 40% are PKR. The standard deviation of exchange movements is 7% for INR and 8% for PKR. Correlation coefficient for the two currencies is 0.50. Based on this information, the standard deviation of these two-currency portfolio is
|
A. |
0.0643 |
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B. |
0.0623 |
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C. |
0.0586 |
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D. |
0.0485 |
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|
E. |
0.0356 |
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