76.8k views
1 vote
The difference between the nominal interest rate and the real interest rate is:

User BingsF
by
3.0k points

1 Answer

3 votes

Answer:

Step-by-step explanation:

A real interest rate is an interest rate that has been adjusted to remove the effects of inflation to reflect the real cost of funds to the borrower and the real yield to the lender or to an investor. A nominal interest rate refers to the interest rate before taking inflation into account.

User Euvs
by
3.5k points