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
Famous quotes containing the words nominal, interest and/or rate:
“Discourage litigation. Persuade your neighbors to compromise whenever you can. Point out to them how the nominal winner is often a real loser—in fees, expenses, and waste of time. As a peacemaker the lawyer has a superior opportunity of being a good man. There will still be business enough.”
—Abraham Lincoln (1809–1865)
“The slaves of power mind the cause they have to serve, because their own interest is concerned; but the friends of liberty always sacrifice their cause, which is only the cause of humanity, to their own spleen, vanity, and self-opinion.”
—William Hazlitt (1778–1830)
““Terence, this is stupid stuff:
You eat your victuals fast enough;
There can’t be much amiss, ‘tis clear,
To see the rate you drink your beer.”
—A.E. (Alfred Edward)