Why is the big mac considered an appropriate index

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Assignment:

Take a look at these short videos

Reflect on these questions:

Chapter presents the Law of One Price, the Absolute Purchasing Power Parity and the Relative Purchasing Parity (among others).

1. Why is the Big Mac considered an appropriate index?

2. What does this Index suggest about the long-term value USD, in other words, can we expect the USD value to increase or decrease in the long-term against other currencies?

Reference no: EM133735753

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