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What are the two main problems when comparing two countries' GDP numbers?

What are the two main problems when comparing two countries' GDP numbers?

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Answer #1
  • When comparing the two countries GDP numbers, we need to convert their individual currencies into a common currency.
  • But when doing so, we are encountered with two main problems. They are:-
  1. Since, we measure a countries GDP based on its currency, comparing between any two countries first requires us to convert them into a common currency.
  2. Different countries have different population. Comparing the GDP numbers between countries requires us to divide GDP by population.
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