Consumers in China earn less than consumers in the United States. International marketers need to look at the ability of consumers to purchase their products. They are looking at ..... in order to set prices for their products.

INTERNATIONAL MARKETING

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Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]

Consumers in China earn less than consumers in the United States. International marketers need to look at the ability of consumers to purchase their products. They are looking at ____ in order to set prices for their products.

A	Unemployment
B	Luxury markets
C	Costs
D	Purchasing power parity

Explanation:

Detailed explanation-1: -Purchasing power parity (PPP) is a popular metric used by macroeconomic analysts that compares different countries’ currencies through a “basket of goods” approach. Purchasing power parity (PPP) allows for economists to compare economic productivity and standards of living between countries.

Detailed explanation-2: -Answer and Explanation: The PPP tends to depict a smaller difference between low-income and high-income nations than other measures of income. The reason is that PPP measures the difference of various currencies across the world in purchasing power.

Detailed explanation-3: -The value for PPP conversion factor, private consumption (LCU per international $) in China was 4.07 as of 2021.

Detailed explanation-4: -What is Purchasing Power Parity? Purchasing power parity (PPP) is a theory which states that exchange rates between currencies are in equilibrium when their purchasing power is the same in each of the two countries.

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BUSINESS ADMINISTRATION

INTERNATIONAL MARKETING