Question
The below data are from the Big Mac Index from The Economist. Please evaluate the Purchasing Power Parity (PPP) in terms of the foreign currency
The below data are from the Big Mac Index from The Economist. Please evaluate the Purchasing Power Parity (PPP) in terms of the foreign currency per USD1. Then predict whether the foreign currency is overvalued or undervalued relative to the USD.
| Country | Big Mac Price | Exchange Rate | PPP | Percentage Under/Overvalued |
| United States | USD4.56 | - |
|
|
| Indonesia | IDR27,939 | IDR 9965 /USD1 |
|
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| Malaysia | MYR7.30 | 3.18 MYR/USD1 |
|
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| Singapore | SGD4.7 | SGD1.27 /USD1 |
|
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| Thailand | THB89 | THB 21.28 /USD1 |
|
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Monetary Policy And Public Finance
Authors: G. C. Hockley
1st Edition
1138704792, 978-1138704794
