The "Big Mac Theory of Exchange Rates" tests the accuracy of purchasing power parity theory.In July 2011,The Economist reported that the average price of a Big Mac in the United States was $4.07.In Japan,the average price of a Big Mac at that time was 320 yen.What is the "implied exchange rate" between the yen and the dollar?
A) 0.013 yen per dollar
B) 78.62 yen per dollar
C) 127.18 yen per dollar
D) 130.24 yen per dollar
Correct Answer:
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