In which of the following ways does using purchasing power parity to calculate GDP differ from the use of straight GDP in measuring a country's economic development?

Question

Quizplus · Accepted Answer

Purchasing Power Parity (PPP) adjusts for differences in price levels between countries, often resulting in a higher measured income for less-developed countries compared to using nominal GDP. This is because goods and services may be cheaper in less-developed countries, so when these price differences are accounted for, the real purchasing power of the economy appears higher.

In Which of the Following Ways Does Using Purchasing Power