According to Purchasing Power Parity, If a Big Mac Sells

question 89

Multiple Choice

According to purchasing power parity, if a Big Mac sells for $3.49 in the United States and 47.25 pesos in Mexico, what is the peso/$ exchange rate?

• A) Ps0.0739 = $1
• B) Ps0.0814 = $1
• C) Ps12.29 = $1
• D) Ps13.54 = $1
• E) Ps14.32 = $1

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Definitions:

Contractual Agreement

A legally binding agreement between two or more parties outlining duties, terms, and conditions that those parties have agreed upon.

Bonds And Stocks

Financial instruments where bonds represent loans to an entity that pays periodic interest, and stocks represent ownership shares in a corporation.

Secondary Equity Offering

A process where a company that is already publicly traded issues additional shares to investors.

Market Value

The current market valuation at which a service or asset is being offered for sale or purchase.