LII New This Week] from March 16th
http://lii.org/cs/lii/print/news/32
features an interesting and easy site for students in economics at all levels:
http://www.economist.com/markets/Bigmac/
– for intermediates, you can use the video, simple and short
– for the weakest students, just offer them the chart to comment:
http://www.economist.com/images/20060114/CIN135.gif
The basic idea from The Economist is that the Big Mac hamburger is one of the rare items sold in the same presentation and content all over the world. Economists can them use its price to decide which currency is strong or weak.
Here is an extract from The Economist:
« [The] Big Mac index is based on the theory of purchasing-power parity, under which exchange rates should adjust to equalise the cost of a basket of goods and services. … Our basket is the Big Mac » (a hamburger produced by the fast-food chain, McDonald’s). Includes comparisons of recent international Big Mac prices, a « Coca-Cola map of the world, » and articles about McDonald’s and fast food. »
– The Big Mac Index
