The Cost of Living, Domestic Purchasing Power, and Minutes of Working Time Requi
ID: 408895 • Letter: T
Question
The Cost of Living, Domestic Purchasing Power, and Minutes of Working Time Required to Buy a Big Mac, Bread, and Rice. Compare and contrast the numbers for Dehli, Los Angeles, Mexico City and New York, discussing the implications of the differences. Be specific and support your response with an example.
City Cost of Living (w/o rent) New Your Domestic Purchasing Power Minutes of Working Time Required to Buy Big Mac 1 kg of Bread 1 kg of Rice Delhi 49 24.7 59 22 36 Los Angeles 88.1 101 11 18 10 Mexico City 58.6 23.2 82 53 22 New York 100 100 13 16 8Explanation / Answer
McDonalds are operating its Fast Food restaurants worldwide which follows the principle on the 'Do It Yourself (DIY) ' policy since 1930. The products are following consistent size and quality and provides a guarantee to serve within a specified time limit to serve the food at the counter without waiter service .
BIG MAC: By the chart it is clearly understood the waiting time is fairly large for Big Mac in comparison of purchasing power and income index of the city and the overall prosperity index of that country. The degree of training of the staffs of this restaurant varied drastically from country to country.
It is lowest in Los Angeles i.e for 11 minutes and the domestic purchase power is the highest despite the cost of living index is also higher side but lower than the follower the New York City.
The second New York city the basic parameters i.e. Domestic purchasing power and cost of living index is more or less similar and nothing to highlight and distinguish between the two.
The Delhi ( In India the purchasing power index is lower side only comparable to Mexico city but the cost of living index is the lowest and the working time is much higher , it implies the factors like inadequate training, low morale of employee and inept to provide such service for the restaurant promises.
The relationship can built up as follows:
This implies the cites from the poor countries like India and Mexico have a larger ratio for both as above. The loer the prosperity , lower the domestic purchasing power the higher the serving time of the premium product. this also implies lower frequency of the buyer of big mac in the relatively poor countries.
However, the exchange ratio has an impact on calculation of the domestic purchasing power , since its need conversion of the concerned currency in to US $.
Bread of I Kg. Pack : It typically higher in Mexico city bears no relevance with economic parameter suxh as Cost of living index and purchasing poer. Even with poor index the city of Delhi in India the working time required to buy is comparative to Los Angeles city. So No comparison chart is prepared for this product . However, the longest time requirement in mexico city needs investigation by the restaurant manangement. It seems something is wrong there in mexico.
Rice:
Here the case of Mexico in case of bread repeats in Delhi in case of rice. typically the north Indians are accustomed to consume bread and the there may be lesser frequency of rice buyer in Delhi and that required much more time i.e 4.5 times than the New York City.
Typically, the non Basmati rice i.e cheaper variety are abundantly available on the street side and that is too cheaper in the inner lanes. since , the rice is not a fancy item to eat it is mainly for neutralize the hunger of visitors of Delhi. So bulk of rice eaters falls within the poors and chances of visit to the premium restaurant is very less. This may be another reason to buy time at the top for rice.
The time are more or less identical in New York and Mexico.
It is a matter of mention that the minutes required in the developed cities like Los Angeles and New York across the four products implies frequent visit of buyer of all the 4 products. This implies even visit of buyers across all the products in this two cities of USA. Especially, the Los Angeles is tourism area and the demand of BIG MAC is highest and the staffs are well prepared to deliver the big Mac in the lowest time among the four cities.
City minute / Cost of Liv minute / Dom P.Power Delhi 1.20 2.39 LA 0.24 011 Maxico 1.40 3.53 New York 0.13 0.13Related Questions
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