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nominal interest rate |
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Nominal interest rate The interest rate unadjusted for inflation. Nominal Interest Rate The interest rate on an investment or loan without adjusting for inflation. The nominal interest rate is simply the interest rate stated on the loan or investment agreement. If one makes a loan at a high nominal interest rate, this does not guarantee a real profit. For example, if the nominal interest rate on a loan is 7% and the inflation rate is 4%, the real interest rate is only 3%.
nominal interest rate The stated interest rate in a note, which may differ from the true (effective) interest rate because of discounting or fees. Want to thank TFD for its existence? Tell a friend about us, add a link to this page, add the site to iGoogle, or visit the webmaster's page for free fun content. |
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