Application of Purchasing Power Parity

Presentation on theme: "Application of Purchasing Power Parity"— Presentation transcript:

1 Application of Purchasing Power Parity
B.衡量國民所得 C.預測長期的匯率走勢

2 Application of Purchasing Power Parity

3 Economist: the Hamburger Standard
Nations Price of Big Mac Implied Exchange Actual Exchange Percentage of Deviation U.S 2.54 $US Australia 3.00 A$ 1.18 A$/$US 1.95 A$/$US -40% Taiwan 70 NT 27.6 NT/$US 32.9 NT/$US -16% China 9.9 RMB 3.90 RMB/$US 8.28 RMB/$US -53%

4 Australia Implied Exchange Rate by PPP = P P* 1.18 A$ / US$
1.18 A$ / Big Mac 2.54 US$ / Big Mac E % of Deviation = 1.18 1.95 1 = -40 % A$ is undervalued by 40%

5 Taiwan Implied Exchange Rate by PPP = 70 NT / Big Mac
2.54 US$ / Big Mac P E = P* = 27.6 NT / US$ % of Deviation = 27.6 32.90 1 = -16 % NT is undervalued by 16 %

6 China Implied Exchange Rate by PPP = 9.9 RMB / Big Mac
2.59 US$ / Big Mac P E = P* = 3.90 RMB / US$ % of Deviation = 3.90 8.28 1 = -53 % RMB is undervalued by 53%

7 Application of Purchasing Power Parity
B.衡量國民所得

8 IMF: 世界經濟展望 2005年 中共GDP Per Capita 傳統方法 : 1461.6 U$
PPP(IMF): U$

9 利用市場匯市將產值換算為美元: e.g. 若1美元=8元人民幣 4兆人民幣合5,000億美元 物價低的國家產值會被低估 U.S China
GDP 1 APPLE Price 1 US$ 4 RMB e.g. Rate 1 US$ = 8 RMB (ie.中共之物價較低) U.S. GDP= 1 US$ China GDP=0.5US$

10 利用以美元計價的“標準價格”去計算各國的GDP
假設蘋果的世界價格為0.75U$ U.S China GDP 1 APPLE GDP(US$) 0.75 會高估產品品質差的國家之產值 假設汽車的世界價格為20,000U$ U.S China GDP 1 CAR GDP(US$) 20,000

11 Application of Purchasing Power Parity

12 Expected Relative PPP Pt Et = Pt* Et+1 - Et => Pt+1 - Pt =