Experts from sites like Investopedia and Britannica note several reasons why the index isn't a perfect science:
Created by The Economist in 1986, the Big Mac Index uses the price of a McDonald's Big Mac as a standard "basket of goods" to compare what money can buy in different countries. What do Big Macs have to do with How Much Money is Worth?
might "go further" in a country like South Africa than in Switzerland. Experts from sites like Investopedia and Britannica note
: Differences in national sales taxes (VAT) and the level of local market competition can distort prices. while in others
: In some countries, a Big Mac is a common meal, while in others, it is considered a luxury item, affecting how McDonald’s sets its prices.
