What is the MXN discount rate that is consistent with Ariel's EUR hurdle rate of 8%? Assume that (i) the annual inflation rates are expected to be 7% in Mexico and 3% in France, and (ii) real rates of return are the same in all currencies. Recall the Fisher Effect: 1 + = (1 + )(1 + ()) where is the nominal rate of return, is the real rate of return, and is the inflation rate. Thus, if is the same in both EUR and MXN, then we have