Weak Currency Ends McDonald's Presence In Iceland

McDonald's has decided to close its two restaurants in little Iceland. While this will improve Iceland's trade balance, it will worsen its real national income.

The reason for the decision is that tiny Iceland (Just roughly 300,000 people or 1,000 times smaller than the U.S.) do not have enough of the commodities to produce the McDonald's meals, meaning that nearly all of the commodities had to be imported from Germany. But with the dramatic downturn in the value of the Icelandic Krona, input costs simply became too high to remain profitable.