The Worldwide Cost of Living Survey 2007 published by Mercer Human Resource Consulting has caused a bit of confusion around the world, just as it did last year. "Moscow ranks as the world's priciest city," writes The Associated Press. But is this true? What the report really said is that "Moscow is the world's most expensive city for expatriates," an important qualifier.

Now what is an expat? According to Marina Cao Lombardi of Mercer Consulting in Switzerland an expat is "somebody sent to Moscow by their companies on an assignment," mostly for the short term. Judging by the rates quoted in the report, these people as a rule live in downtown apartments, drink coffee in upscale restaurants or hotels, buy their clothing at designer stores, and generally try to maintain the lifestyle they have gotten used to in their home countries.

In other words, people who live a very different lifestyle from your average Russian or expat-gone-native. Those would only laugh at the list of expenses included in the report, such as $24.77 for a music CD or $6.10 for a cup of coffee.

I have yet to meet an expat who doesn't buy most of his music at one of the hundreds of stalls peddling pirate copies all over town. At about $4 a piece, and more often than not loaded with up to a hundred tracks, they are simply irresistible.

On Monday, I enjoyed a wonderful cup of espresso for about $2.40 at a very nice café down at Akademicheskaya. At Shokoladnitsa, probably the most common place for people to drink their lattes and espressos, you can have a large cappuccino for $4.50. I pay that much at Starbucks in Ottawa.

For Mercer, however, these places are apparently not expensive enough. "We take into consideration good standard stores and restaurants," says Lombardi. That obviously excludes anything not at TsUM and should teach Shokoladnitsa or Planeta Sushi to get their act together.

Like many expats, I have never eaten at the Most restaurant. The prices on the menu are simply too ghastly. But that doesn't mean I cannot afford to dine out. Two weeks ago my wife and I gorged ourselves on Sushi not far from Oktyabrskaya metro station. Including a $20 tip - I was feeling generous - the meal set me back only $130. Not cheap by my standards, but the place was nice, the service excellent, and it wouldn't have cost much less in Ottawa.

One undeniable fact is that Moscow apartments are expensive. According to several agents I talked to, a furnished one-bedroom apartment in reasonable condition can easily cost $1000. That's not much more than I would pay back home. At the same time, however, utilities are cheap. If your hydro bill exceeds $10 a month for your one-bedroom apartment, you haven't been careful enough with the dishwasher.

Once you have paid for rent and utilities, life in Moscow is actually quite cheap. At a normal supermarket, you can get fresh bread for $0.60, half pound butter for $1, Maasdam cheese for $9/kg or less... Unless you splurge every day on imported Italian mozzarella and Japanese rice noodles, you can comfortably feed yourself on less than $15 a day. And that's when I do the shopping. My Russian friends probably think I'm nuts spending that much money.

Even more amusing is the entry N/A in the category bus/tube ticket. With a single metro ticket costing only about $0.68, Moscow not only has one of the most efficient and fastest metros in the world, but also by far the cheapest - New York's subway charges $2 for a single ride. If you stay here for three months, you can travel even cheaper by buying a 90 day ticket for $60 that provides an unlimited number of rides.

And if you want to get around in Moscow on the quick, Metro is the way to go. Yes, it's crowded, but have you seen the roads? The traffic jams here are legendary. I wouldn't go by car if I had one and I know plenty of people with good incomes who have opted not to own a car in Moscow.

Most expats in Moscow make more money than they would at home. A native English speaker, for example, can earn $25 an hour teaching English. Even if he pays 13 percent income tax, that still leaves him with more take-home income then he would make in the United States.

Combine this with the quite low costs for groceries, cheap clothing for those who don't mind buying Russian made goods (most of which are good), and you end up with a pretty affordable way of life.

Of course, if you want to live in an 80 square meter apartment in thecity center, eat only the food you got used to at home, send your kids to American private school, read your New York Times every morning, and go only to places where people speak English - well, then Moscow is going to be a bit more pricy than London or New York. But don't blame your higher expenses on Moscow, but rather see them as the price you pay for not making even the smallest concessions to local life.