Suppose a McDonald's Big Mac costs 30 pesos in Argentina. At the same time, suppose the exchange rate between the peso and the euro is roughly 15 pesos per euro. According to purchasing power parity, a Big Mac in Europe should cost:
A) 0.50 euros.
B) 2 euros.
C) 15 euros.
D) 30 euros.
Correct Answer:
Verified
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