05 April 2010

Price Check Please

Moscow's food prices are quite expensive, or so I thought.  Under attack by a weak will and a starving stomach, I visited McDonald's in the northern edge of Moscow.  It appears that McDonald's is the great international equalizer.

The Equalizer
For approximately $6, I gorged on a Big Mac, large fries, and a medium coke.  This is roughly the same price as I would pay for the same meal in Silicon Valley.  This is in contrast to the up to 10X price difference that I have witnessed in other eateries. 

Curiously, according to The Economist's Big Mac Index, the Russian ruble is undervalued by some 30%.  In other words, one US dollar should only purchase 20 rubles instead of 30.  That makes the theoretical value of my Russian meal $9 instead of $6, but a far cry from the $60 that my earlier analysis suggested.

In the macro-economical sense, this is wonderful news for Russian consumers as they have a higher purchasing power.  In a public-health sense, Russians should ponder heavily on America's weight problem.

Children Are Our Future

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