Lab 6: The Big Mac Index

 

1. What is the Big Mac Index? (Yes, Google will answer this index, but it won't answer this question without help from you.)

 

2. In the latest Big Mac Index (October 14, 2010), which worldwide currency is the most over-valued? under-valued? relative to what currency?

 

3. Exchange rates are fixed between the states in the United States of America. With fixed dollar exchange rates, how would the Big Mac Index be interpreted within the United States?

 

4. Get the data, document your sources, and compute the Big Mac Index for Ithaca, NY and one other micropolitan statistical area (core-based statistical area <50,000 in population) outside of the State of New York. Interpret your answer. Feel free to use 20th century or 21st century methods to get your data.

 

Lab results should be emailed by Friday March 4, 10:00am (the day of the lab) to both the instructors: lars.vilhuber@cornell.edu and john.abowd@cornell.edu.