If a McDonald's Big Mac Cost $3

Multiple Choice

If a McDonald's Big Mac cost $3.06 in the United States and 3.21 euros in the Euro area, then purchasing-power parity implies the nominal exchange rate is how many euros per dollar?

A) 1.05 If the value is less than this, it costs more dollars to buy a Big Mac in the U.S. than in the Euro area.
B) 1.05 If the value is less than this, it costs fewer dollars to buy a Big Mac in the U.S. then in the Euro area.
C) .95 If the value is less than this, it costs more dollars to buy a Big Mac in the U.S. than in the Euro area.
D) .95 If the value is less than this, it costs fewer dollars to buy a Big Mac in the U.S. than in the Euro area.