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Let's assume that the price of Big Mac in Turkey sells for 2 0 Turkish Lira ( TL ) and that the price of the

Let's assume that the price of Big Mac in Turkey sells for 20 Turkish Lira (TL) and that the price of the same burger is 6$ in the U.S.A. Please calculate the TL/$ exchange rate according to the law of one price and interpret if the actual exchange rate is overvalued or undervalued, if the exchange rate is at 4 Turkish Lira per US$. If it is overvalued or undervalued, what causes such a disparity between the actual exchange rate and the assumed exchange rate by the law of one price?

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