Purchasing power parity is used to compare the gross domestic product between businesses. consumers. stock markets. countries.

The correct answer is: "countries".

The purchasing power parity (PPP) is an economic theory which compares different currencies from two countries by using a specific basket of goods. The prices of the goods, denominated in the two different currencies, should be equal after deducing the effect of the exchange rates between the two currencies and of the different interest rates existing in the two countries. But such equality does not hold in reality and one of the currencies usually has a greater purchasing power than the other.

The PPP, relates to GDP in the sense that it helps to deduce the purchasing power of the inhabitants of a country, by determining whether they can purchase more goods and services than the inhabitants of another country, with an equivalent amount of currency.

Purchasing power parity is used to compare the gross domestic product between : Countries.

Purchasing power parity is a theory in economics, which shows the difference between currencies of different countries. It measure prices of goods in different countries.

The purchase power parity implies that once an exchange rate is applied, the cost of goods in a country be the same in another country.

Hence, purchasing power parity is used to compare the gross domestic product between countries.

Learn more about purchasing power parity (PPP) here : link

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