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:

Personal Services

Work done or to be done directly by a person as opposed to a product or commodity, often involving professional or artistic skills.

Foreseeable Damages

Damages that a party could reasonably anticipate at the time of contract formation, should a breach occur.

Subjective

Based on or influenced by personal feelings, tastes, or opinions rather than external facts or evidence.

Restitution

The act of restoring someone to their original state, or compensating for a loss, damage, or injury caused.