chasing power parities (PPP) are currency conversion rates that allow output in different currency units to be expressed in a common unit of value. A PPP is the ratio between the number of units of a country's currency and the number of U.S. dollars required to purchase an equivalent market basket of goods and services within that country. Compensation costs refer to average hourly compensation costs for all employees in manufacturing. See section 3 notes. The price of a basket of goods that costs one dollar in the United States is known as the relative price. Relative prices are calculated by dividing PPP by market exchange rates. See the discussion of relative prices in Sources above.
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Last Modified Date: September 25, 2012