You and your friend decide to backpack around Europe.

You’ve been debating whether Europe or Canada is more expensive. Your friend spies a McDonald’s and says they can prove that Europe is more expensive by comparing the price of a Big Mac in Paris with what it costs where you study in Montreal. How would you go about comparing these two prices? Why would this information help inform your debate?

Learning Objective 16.5 Track how money flows around the world using the current account and the financial account.