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**What do you mean by Nominal interest rate?**

An internet rate is said to be nominal, if this rate is considered before inflation. Nominal interest rate takes two different situations. The compounding must be identical, but in case of nominal interest this is not identical with a basic unit of time which is normally a year. So, frequency of compounding should be finding out as this is identical or not.

You need to understand that how the formulae work. You just need to go through the following formula as

(1 + nominal rate) = (1 + real interest rate) (1 + inflation rate)

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**What are the different terms related to Nominal interest rate? **

**The different terms are as follows- **

- Real rate interest
- Inflation Rate
- Inflation protected Securities
- Treasury Bond
- Financial institution
- Recession
- Nominal Value
- Real Rate of return
- Nominal rate of return

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