Malaysia is 3rd cheapest place to buy a Big Mac

February 24, 2014 Leave a comment

Malaysia is 3rd cheapest place to buy a Big Mac

Sunday, February 16, 2014 – 16:47

New Straits Times

KUALA LUMPUR – Malaysia has been ranked one of the cheapest places in the world to purchase a Big Mac, according to The Economist.

The British news magazine’s annual “Big Mac” Index, which gauges if global currencies are at their correct level, has ranked Malaysia third behind India and South Africa as the cheapest place in the world to purchase the McDonald’s signature burger.

“The price paid for a Big Mac in Malaysia is RM7.40 (S$2.82), which is equivalent to US$2.23 when converted using the global exchange rates.

“This amount is lower when compared with the actual price of a Big Mac that is sold in the United States for US$4.62 (S$5.80), indicating a 50 per cent difference.

“In other words, the Big Mac sold in Malaysia is half the price of the same burger sold in the US,” the magazine revealed.

India’s “Maharaja Mac” only cost US$1.54, which is three times less than it is sold in the US, hence making it the cheapest Big Mac available in the world.

At the other end of the spectrum, Norwegians are being ripped off for a Big Mac as it is sold for US$7.80, 70 per cent more than what the burger costs in the US.

Other countries listed as selling Big Macs at high prices included Venezuela (USD$7.15) and Switzerland (US$7.14).

“Big Mac” Index was invented by The Economist in 1986 as a light-hearted guide to measure the value of currencies worldwide. It is based on the theory of purchasing power parity, the notion that in the long run exchange rates should move towards a value that would equalise the prices of an identical basket of goods and services (in this case, a burger) in any two countries. McDonald’s Big Mac was selected as a measuring tool as it is sold in about 120 countries.

 

Filed under Macro Trends

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Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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