In order to better compare/contrast costs of living in the various environments GNP/GDP may be adjusted to:
A) PPP (purchasing power parity)
B) Foreign exchange rate
C) Country s inflation rate
D) Five-year national bond appreciation/depreciation

Question

Quizplus · Accepted Answer

PPP (purchasing power parity) is the most appropriate method for adjusting GNP/GDP for comparison purposes as it takes into account the differences in the cost of goods and services between different countries. Adjusting for foreign exchange rates or the country's inflation rate may not provide an accurate reflection of the true cost of living differences. Five-year national bond appreciation/depreciation is not relevant to comparing costs of living. PPP (purchasing power parity) takes into account the cost of living in a particular country by adjusting the GDP/GNP based on the relative prices of goods and services. This helps to better compare the cost of living between countries, as it takes into account factors such as exchange rates and inflation. The other options listed do not directly relate to the cost of living and would not be as useful for this purpose.

In Order to Better Compare/contrast Costs of Living in the Various