Big Mac Index 2012

Big Mac Index 2012

The Big Mac Index 2012 is a model that economists use to determine the relative value of currencies. The Big Mac Index 2012 provided on this page is a continuation of a long-term tradition of providing this basic well-known economic measure.

Big Mac Index 2012 in details

The so-called Big Mac Index is a very simple indicator which economists and others use to quickly compare currencies. The Big Mac Index is based on so-called Law of One Price. The idea behind the Law of One Price is that a product should cost the same amount of money in all countries. Any place you go, you should pay the same. This can be accomplished through the exchange rate which is the factor that makes the Law of One Price happen (this concept relates to the so-called theory of Purchasing Power Parity).

2012 Big Mac IndexIn other words, exchange rates should eliminate differences in price levels in individual countries. If the price level in one country rises (due to inflation), the value of its currency should decline. If the currency value does not decline, then the currency would be overvalued which would mean that goods of this country would become, in the context of international trade, too expensive. This is the simple idea behind the Big Mac Index 2012.

Why the Big Mac Index 2012

Ideally, when trying to determine the valuation of currencies, one should compare price levels which can be computed off of valuations of baskets of good (see Consumer Price Index for more details). This method however involves a lot of work. This made economists to come up with a more simple method, the Big Mac Index concept. The Big Mac Index 2012 simply works by comparing the value of McDonald's Big Mac hamburgers in individual countries in year 2012. See here for more general information about the Big Mac index.

Big Mac Index 2012 XLS Excel

In addition to this article, we also provide values for Big Mac Index 2012 as XLS (or Excel). For Big Mac Index 2012 XLS Excel spreadsheet, see here: Big Mac Index 2012 XLS. (Right click - Save Target As - save the XML file - open the XML file in Excel)

2012 Big Mac Index

The Big Mac Index is computed usually annually but an ad-hoc calculation can be done as well. This page provides a computation of the index for the year 2012, thus the name Big Mac Index 2012.

Big Mac index 2012

The US dollar is the base point for the Big Mac Index 2012.

Other topics such as the Robin Hood Index, Lorenz Curve, or Gini Coefficient closely relate to the Big Mac index. Our site provides a history of Big Mac Index all the way to the year of 2004. For older Big Mac indices, see for example

Big Mac Index 2011,
Big Mac Index 2010, and
Big Mac Index 2009

and links to other web pages about the Big Mac Index on those pages.


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