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What is

*In Reference to HULLCH10_Question 10.5:*What is

*Simplified Approach**the the solution is referring to here ..?***Equation 10.4****Question 10.5:**Suppose that observations on an exchange rate at the end of the past 11 days have been 0.7000, 0.7010, 0.7070, 0.6999, 0.6970, 0.7003, 0.6951, 0.6953, 0.6934, 0.6923, and 0.6922. Estimate the daily volatility using both approaches in Section 10.5.**Answer:**The standard formula for calculating standard deviation gives 0.547% per day. The simplified approach in equation (10.4) gives 0.530% per day.
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