The ‘Big Mac Index,’ Now Extra Well Done

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Packed with number-crunching power. Photo: McDonald's

"The Big Mac index was invented by The Economist in 1986," the magazine writes, "as a lighthearted guide to whether currencies are at their 'correct' level." It's since become the benchmark for understanding the relative values of currencies around the world. It may not be constructed on the best foundation of economics, but that's why they call it "burgernomics," and anyhow — fortified with raw GDP as it is — the chart is not without its insights. Check out the new, "interactive" version of the Big Mac Index here, then school yourself in exchange-rate theory by dredging through the comments, and all that special sauce. [Economist]