Nominal Interest Rate

In finance and economics, nominal interest rate or nominal rate of interest refers to two distinct things: the rate of interest before adjustment for inflation (in contrast with the real interest rate); or, for interest rates "as stated" without adjustment for the full effect of compounding (also referred to as the nominal annual rate). An interest rate is called nominal if the frequency of compounding (e.g. a month) is not identical to the basic time unit (normally a year).

Read more about Nominal Interest Rate:  Nominal Versus Real Interest Rate, Nominal Versus Effective Interest Rate

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