Assume That a Big Mac Costs $4

Multiple Choice

Assume that a Big Mac costs $4.93 in the United States and that the Brazilian real is undervalued by 23 percent. According to the Big Mac Index published by The Economist, a Big Mac would

A) cost a bit more in Brazil than in the United States.
B) cost less in Brazil than in the United States.
C) cost the same in both countries.
D) would cost twice as much in Brazil.
E) would cost less than half of the United States price in Brazil.