Once you inflation-adjust the price of the Big Mac, as I did in the green line, that line - theoretically - would be as flat as a board. If you believed the government's numbers, your $1.80 Big Mac from 1986 costs only $2.43 today. The green line shows how much, inflation-adjusted, two all-beef patties, special sauce, lettuce, cheese, pickles, onions on a sesame seed bun would cost in 1986 dollars. And, perhaps this is "proof" of that when you track the actual price of something that is consumed by Americans. It is often said that the CPI data is off by a long shot. There is a large disparity between the two. But, instead of showing the difference between any one nation and its relative burgernomics, I wanted to show official data released by the United States Bureau of Labor Statistics i.e., CPI inflation, and the actual price of the Big Mac over a period of time. That basket of goods is just one thing: The McDonalds Big Mac ( MCD) the indicator was created in 1986 by The Economist magazine. The Big Mac Index is a light-hearted attempt to demonstrate Purchasing Power Parity ( PPP) between countries using a basket of goods.
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