Principles of Corporate Finance_ 12th Edition

716 Part Eight Risk Management

bre44380_ch27_707-731.indd 716 09/30/15 12:10 PM

(a)

10

100

1,000

$/£ exchange rate (1899 = 100), log scale

U.K. nominal U.K. real

189919041909191419191924192919341939194419491954195919641969197419791984198919941999200420092014

(b)

$/FRE exchange rate (1899 =100), log scale

0

1

10

100

1,000

France nominal France real

189919041909191419191924192919341939194419491954195919641969197419791984198919941999200420092014

(c)

$/ITL exchange rate (1899= 100), log scale

1

10

100

1000

Itay nominal Italy real

0

189919041909191419191924192919341939194419491954195919641969197419791984198919941999200420092014

◗ FIGURE 27.3

Nominal versus real exchange

rates in the U.K., France, and Italy.

December 1899 = 100. (Values are

shown on log scale.)

Source: E. Dimson, P. R. Marsh, and M.

Staunton, Triumph of the Optimist: 101 Years

of Global Investment Returns (Princeton, NJ:

Princeton University Press, 2002). Reprinted by

permission of Princeton University Press, with

updates provided by the authors.