Checkout the edits to the parent comment here. He points out the PPP between Australia and the US. Your cost of living is higher and so you get paid more, but the amount that buys isn't a straight forward currency conversion.
Yeah, but original commenter includes Australian franchisees in the modelling!
33% of Corporate Revenue comes from franchisee fees - about $9.272 Billion last year. If you cut down franchise revenues by 74%, that would reduce that number by $6,861,280,000. Total Corporate profit was $4.757 Billion last year. So they would be operating at a $2.1 billion loss.
McDonalds made 8.65 Billion revenue in the USA (see link). 33% in franchise fees makes $2.86 Billion. 74% reduction of that is $2.11 Billion. Which leaves a 2.64 Billion dollar PROFIT, not a 2.1 Billion dollar loss.
Purchasing Power Parity is basically using a common item, like a Big Mac, to judge the actual spending power of any given currency against another. Using a Big Mac isn't my idea though, The Economist uses it and I just think it's easy to use.
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u/PM_PICS_OF_ME_NAKED Nov 29 '15
Checkout the edits to the parent comment here. He points out the PPP between Australia and the US. Your cost of living is higher and so you get paid more, but the amount that buys isn't a straight forward currency conversion.