(Data file: UBS prices) The international bank UBS regularly produces a report (UBS, 2009) on prices and earnings in major cities throughout the world. Three of the measures they include are prices of...

(Data file: UBS prices) The international bank UBS regularly produces a report (UBS, 2009) on prices and earnings in major cities throughout the world. Three of the measures they include are prices of basic commodities, namely 1kg of rice, a 1kg loaf of bread, and the price of a Big Mac hamburger at McDonalds. An interesting feature of the prices they report is that prices are measured in the minutes of labor required for a “typical” worker in that location to earn enough money to purchase the commodity. Using minutes of labor corrects at least in part for currency fluctuations, prevailing wage rates, and local prices. The data file includes measurements for rice, bread, and Big Mac prices from the 2003 and the 2009 reports. The year 2003 was before the major recession hit much of the world around 2006, and the year 2009 may reflect changes in prices due to the recession. The figure below is the plot of y = rice2009 versus x = rice2003, the price of rice in 2009 and 2003, respectively, with the cities corresponding to a few of the points marked.