The conversation between human and AI assistant.
What is a more useful measure to judge a nation's economy: GDP (nominal) or GDP (PPP) and why?
That makes sense. How does this adjustment work?
PPP stands for purchasing power parity, which means that GDP (PPP) takes into account how much money is needed to purchase the same basket of goods across different countries. So, a country with a high cost of living would have a lower GDP (PPP) than a country with a lower cost of living, even if they have the same nominal GDP.