International Finance The below data are from the Big Mac Index from The Economist Please evaluate the Purchasing Power Parity (PPP) in terms of the foreign currency per USD1 Then predict whether the foreign currency is overvalued or undervalued relative to the USD Country Big Mac Price Exchange Rate PPP Percentage Under Overvalued United States USD4 56 Indonesia IDR27,939 IDR 9965 USD1 Malaysia MYR7 30 3 18 MYR USD1 Singapore SGD4 7 SGD1 27 USD1 Thailand THB89 THB 21 28 USD1 (10 marks)

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Question: International Finance The below data are from the Big Mac Index from The Economist. Please evaluate the Purchasing Power Parity (PPP) in terms of the

International Finance

The below data are from the Big Mac Index from The Economist. Please evaluate the Purchasing Power Parity (PPP) in terms of the foreign currency per USD1. Then predict whether the foreign currency is overvalued or undervalued relative to the USD.

Country	Big Mac Price	Exchange Rate	PPP	Percentage Under/Overvalued
United States	USD4.56	-
Indonesia	IDR27,939	IDR 9965 /USD1
Malaysia	MYR7.30	3.18 MYR/USD1
Singapore	SGD4.7	SGD1.27 /USD1
Thailand	THB89	THB 21.28 /USD1

(10 marks)

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