What Does Nominal Mean? Definition & Examples. ... You might see nominal rates in reference to a stock portfolio, a mutual fund's performance, or the growth or contraction of the GDP.

Real Interest Rate Examples . For example, putting $1,000 into a savings account that earns 2 percent annual interest at the start of the year would yield $1,020 by year’s end. But with an ...

For instance, if a loan offers a 4% nominal interest rate and inflation is 2%, the real interest rate is approximately 2%. The world of finance has a somewhat different definition.

For example, inflation in March 2022 reached 8.5%, when nominal rates on Treasury bonds were about 2.5%, which means those bonds yielded a real rate of return of -6.0% if inflation remained steady ...

For example, if the inflation rate is 5%, on a one-year loan of $1,000 with an 8% nominal interest rate the real interest rate would be 8% minus 5% or 3%. The real interest rate will usually be ...