Question

The Big Mac Index. Discuss and review the application of the Index to currency exchanges.Is it viable? How accurate is the Index?

Answer 1

The BIG MAC INDEX is basically presented by the economist as a informal way to calculate the value of the currencies of the different countries by using the price of the McDonald's BIG MAC as the benchmarks . It is one of the easiest way to to calculate the value of the currency of the countries but not totally accurate as it have to .

As its easy way to calculate the currency level with the other countries for everyone due to which use to use it as the base way to find the value of the currency for there business going on globally . It helps them to take advantages of the currency rate of there country at the time of there business . Its getting a good amount of reviews because of its so easy and comfortable way to calculate the currency values .

NO not really , its not so accurate as its calculated on the bases of the PPP ( purchasing power parity ) which not so good predictor of the exchange market . But as per we see no calculation( like this kind of calculation ) provides accurate answer its always approximately . Then its good for the globally running businesses for there prediction about the currency .

yeah , it viable in some cases as because of it easiness and the help to the business and the people to predict the currency value with the other country . Its easily applicable by everyone and can be used and time by and one in the globe . Because of the complex formulas and the complex way to calculate the currency rate with them it was little time consuming and hard to find , with this people find it really comfortable and is providing the approximate amount helps people a lot .