Consider the following statements : I. Purchasing Power Parity (PPP) exchange rates are calculated by comparing the prices of the same basket of goods and services in different countries. II. In terms of PPP dollars, India is the sixth-largest economy in the world. Which of the statements given above is/are correct?

Question

CollectorBabu · Accepted Answer

Correct Answer: 1 only. Purchasing Power Parity (PPP) exchange rates- The rate at which the currency of one country would have to be converted into that of another country to buy the same amount of goods and services in each country.  Hence, statement 1 is correct. In terms of PPP dollars, India is the third-largest economy in the world, behind only China and the USA. Hence, statement 2 is incorrect.

Contact Information

Services