In july 2014 the average price of a big mac was pound280 in, Ask an Expert

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In July 2014, the average price of a Big Mac was £2.80 in Britain and $4.20 in the U.S. The actual exchange rate was $1.60/£. Please answer the following questions:
1)Where can you buy cheaper hamburgers: Britain or U.S.?
2)Calculate the "correct" exchange rate, based on the law of one price.
3)Based on the PPP, was the British pound overvalued or undervalued and by how much?

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