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Definition of Nominal
In name only. Differences in compounding cause the nominal rate to differ from the effective
Measured in money terms, in current rather than real dollars. Contrast with real.
A monthly fixed-dollar payment beginning at retirement age. It is nominal
An effective rate per period multiplied by the number of periods in a year.
A cash flow expressed in nominal terms if the actual dollars to be received or paid out are given.
The actual foreign exchange quotation in contrast to the real exchange rate that has
The interest rate unadjusted for inflation.
Price quotations on futures for a period in which no actual trading took place.
The rate of interest quoted, or stated, to be paid on a security
Rate at which money invested grows.
The price of one currency in terms of another, in this book defined as number of units of foreign currency per dollar.
Payment for the use of borrowed funds, measured as a percentage per year of these funds.
The contracted, or stated, interest rate, undeflated for price level changes.
A theory that nominal interest rates in two or more countries should be equal to the required real
A contract promising a stated nominal interest rate over some specific time
The rate of interest excluding the effect of inflation; that is, the rate that is earned in terms
The nominal value of a security. Also called the par value.
nominal value of a security. Same as face value.
The nominal interest rate that the issuer promises to pay the
a. Measure of return on an investment, stated as a percentage of price.
international Fisher effect
Theory that real interest rates in all countries should be equal, with differences in nominal rates reflecting differences in expected inflation.
A price index used to deflate a nominal value to a real value by dividing the nominal value by the price deflator.
Exchange Rate, Real
The nominal exchange rate corrected for price level differences.
Price index used to deflate nominal GDP to real GDP by dividing nominal GDP by the GDP deflator.
Interest Rate, Real
nominal interest rate less expected inflation.
Money Rate of Interest
See interest rate, nominal.
Quantity Theory of Money
Theory that velocity is constant, and so a change in money supply will change nominal income by the same percentage. Formalized by the equation Mv = PQ.
Measured in base year, or constant, dollars. Contrast with nominal.
GDP expressed in base-year dollars, calculated by dividing nominal GDP by a price index.
Income expressed in base-year dollars, calculated by dividing nominal income by a price index.
The number of times during a year that the money supply turns over in supporting that year's economic activity, measured as the ratio of nominal income to the money supply.
The nominal value which appears on the face of a document recording an entitlement, generally an amount of money that has to be repaid on the maturity of a debt instrument.
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