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Charlie Munger

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Purchasing Power Parity

 

Purchasing power parity (PPP) is economical term used to compare purchasing power of the same currency (USD) in different countries. 

 

The principle is that for the same $1000 you may buy different amount of the same goods in different countries. Usually, poorer countries have cheaper pricing, that’s why PPP is often used for GDP adjusted by purchasing power comparison. 

 

 






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