Use the Table for the Question(s) Below

question 15

Multiple Choice

Use the table for the question(s) below.
Consider the following prices from a McDonald's Restaurant:

-A McDonald's Big Mac value meal consists of a Big Mac Sandwich,Large Coke,and a Large Fry.Assuming that there is a competitive market for McDonald's food items,at what price must a Big Mac value meal sell to insure the absence of an arbitrage opportunity and uphold the law of one price?

• A) $4.08
• B) $4.38
• C) $5.47
• D) $5.77

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Definitions:

Planning Strategies

Approaches and methods used in preparing for future action, especially in business, government policy, and personal objectives.

Pros And Cons

The advantages (pros) and disadvantages (cons) of a particular decision, situation, or system, considered when making a choice.

Consistent

Showing steady conformity to a particular pattern, standard, or set of rules over time.

Over Time

A period extending beyond the usual hours of work, often associated with additional pay; or gradually through a period.