Big-mac index can be used as a yardstick for determining


Big-Mac Index can be used as a yardstick for determining whether a currency is undervalued or overvalued. This is an important issue in politics, as complaints from producers and trade unions about unfair competition from countries with undervalued currencies might drive politicians to impose anti-dumping measures. The Big Mac Index says that the Indonesian rupiah was roughly 50 percent undervalued. Is this a sufficient argument for concluding that we here have a case of unfair competition? If so, why, and if not, again: why?

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Microeconomics: Big-mac index can be used as a yardstick for determining
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