Their calculations would be yes to our exchangers! Western experts believe that the dollar/ruble exchange rate should be 23 rubles . As they say, back to the 2000s! This is the conclusion made in another study by the American magazine The Economist . The traditional Big Mac index showed that we have it the cheapest in the world. As is the currency.
For example, in the US, a Big Mac costs $5.81 (440 rubles), and in Russia it costs 135 rubles ($1.77). We substitute these values into the formula and, thanks to such a simple calculation, we get the “fair” exchange rate of the Russian currency, as American journalists see it.
“The difference between this figure and the current exchange rate of 77.42 rubles suggests that the ruble is undervalued by 70%,” write the index compilers.
Such strange mathematics is explained by the fact that back in 1986, the “wise men” from The Economist put forward an interesting hypothesis. Like, if the ingredients for the production of the most popular burger are the same in all countries of the world, then it should cost the same. This is called purchasing power parity. If the price differs in different countries, then the exchange rate of a particular currency is undervalued or overvalued against the dollar. And over time, it should approach the equilibrium value.
Of course, most Russians would not give up the long-forgotten exchange rate of 23 rubles to the dollar. But the naive hypothesis of American journalists has long been refuted by all leading economists (not only Russian ones). Firstly, the ingredients may be the same, but their cost in different countries may differ. Secondly, the price of a burger is influenced not only by products, but also by other factors: taxes, labor costs, rent, etc. Third, the level of development in all countries is different. Therefore, it is quite logical that Big Mac in Russia costs 3 times cheaper than in America. Otherwise it can not be.