How much will a Big Mac cost you in Lima? Or Abu Dhabi? The answers can tell you a lot about “purchasing power parity (PPP)” – whether exchange rates mean that a product costs the same in different countries. A tool to make this theory more “digestible” was launched by The Economist in 1986. It allows comparison of several base currencies to others around the world. As they wrote this month: “A Big Mac currently costs $5.06 in America but just 10.75 lira ($2.75) in Turkey, implying that the lira is undervalued.”
Since McDonald’s restaurants aren’t so common in Africa, the market research firm Sagaci Research invented the supplementary “KFC index” to analyse PPP there
Read the full article here:
http://www.bbc.com/future/story/20170202-how-fast-food-reveals-secrets-of-the-economy
