Infographic: Using ‘Big Mac’ Burgers, Today’s Global Economy Explained
Online MBA has created an infographic, ‘The Big Mac Index’ also known as ‘Burgernomics’, that looks at today’s global economy and explains how everything is connected in its own way.
The Big Mac Index was first introduced by ‘The Economist’ in 1986. It’s a global standard of “determining purchasing power between two currencies”, according to the infographic.
To calculate The Big Mac Index, users divide the price of a Big Mac in one country (in its local currency) by the price of a Big Mac in another country (in its local currency); and compare this value with the current exchange rate.
A lower value indicates that the first currency has been undervalued, while a higher value indicates that the first currency is overvalued.
The Index suggests that most emerging market currencies are significantly undervalued.
The infographic also looks at how long a work needs to work, to earn enough so that he can afford a burger.
In Tokyo, Japan, only 10 minutes is required; while in Nairobi, Africa, one would need 158 minutes.
The most expensive burgers are in Norway; and the least expensive, Ukraine.
Click to view full infographic