Concept: January 3, 2023. What is Purchasing Power Parity (PPP)?

Purchasing Power Parity (PPP) is a factor by which the price of a basket of goods and services in a particular country has to be multiplied in order to compare it with the same basket in another country.

Example: Country A has the price of a basket of goods and services at 10 dollars. Country B has the price of the same basket at 5 dollars. The PPP for country B is 2. This means that if you want to compare the GDP of countries A and B, you would have to multiply the country B's GDP by 2.

For further information, read this article

This post is intended to only raise awareness. In order to make actual financial decisions please contact your financial advisor and/or tax advisor prior to making the decision.