Carat is a Diamond measurement unit signifying weight and it has nothing to do with the gemstone quality. Also, this unit is different from ‘Karat’ denoting gold purity. Among the 4 Cs namely-Carat, Clarity, Color, and Cut, this is the easiest one to determine. Those interested will love to know that the word CARAT comes from Carob seeds, which during the ancient times were used for balancing scales. Being uniform in weight and shape, these seeds were able to give accurate measurements even by the modern weighing standards.
1 Carat = 100 points
1 gram = 5 Carat
So, for example if you have a diamond that measures 75 points it will equal 3/4 carat or 0.75ct in weight.
A diamond size remains proportional to its carat weight. Polishing and cutting of the stone leads to loss in carat with the finished product becoming up to 2/3rd lighter than its original weight. Bigger, high quality rough stones are less frequently available compared to smaller yet quality stones. Hence latter are less expensive than the former with a 2 carat single diamond costing much more than two 1 carat diamonds together.
However, it is important to note that even two stones with similar carat weight may claim vastly different prices owing to the other 3Cs- Clarity, Cut, and Color. Carat doesn't give an insight into the size of the diamond. There is simply no reason to equate the two. Dimensions of the stone determine their appearance greatly. Distance across the diamond top also requires special consideration. Stone cut and shape plays a big role in the way it appears.
For example, an elongated Diamond will seem larger than a round one, despite both weighing the same. The price of the diamond however mostly depends on its carat weight. Heavier a diamond is, the larger its carat weight. Also the pricier it becomes. Carat price is the best way to compare costs of stones that are similar. It is important to note that modern Carat Weights do not give accurate results one it comes to stones manufactured before 1913. Vintage diamonds may come out larger or smaller when measured against modern values.