Questions
Questions
Single choice

The price of a Big Mac in the U.S. is $3.41 and the price in Mexico is Peso 29.0. What is the implied PPP of the Peso per dollar?

Options
A.A. Peso 8.50/$1
B.B. Peso 10.8/$1
C.C. Peso 11.76/$1
D.D. None of the above
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Step-by-Step Analysis
To evaluate the implied PPP, we compare the price of the same basket (a Big Mac) in two countries. - In the U.S., the Big Mac costs 3.41 USD. - In Mexico, the same Big Mac costs 29.0 Pesos. The PPP exchange rate in Peso per dol......Login to view full explanation

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