Are あの店は良いです and あそこの店は良いです both grammatically correct? If so, what is the difference?
The first is “that shop” and the second is “the shop over there”. Which is to say, あの is specifying the exact shop, while あそこ is identifying the shop by its location.
But yeah, both are grammatically correct, though you’d use them in different contexts. The first might be “I like Daiso1. That shop is good” while the second might be “I like Akasaka2. The shop that’s there is good.”
Side note, いい is usually written in kana.
1 A 100-yen store chain.
2 A neighbourhood in Tokyo.
Both can refer to a shop that is physically distant from both the speaker and the listener. Like if you are standing there and pointing.
But あの can also refer to things by how they’ve been referenced in conversation. あそこ can only refer to physical proximity.
For more info on how to use あの in conversation:
I understand now, thank you! Thanks for the examples too.