Nominal
Nominal is a financial term used to describe a value that has not been adjusted for inflation or other external factors. It is the original value of a currency, commodity, or security, and is not adjusted for any changes in the market. Nominal values are often used to compare different investments or to compare the same investment over time.
History of Nominal
The term “nominal” has been used in finance since the early 19th century. It was originally used to describe the face value of a currency, which was the amount printed on the note. This value was not adjusted for inflation or other external factors, and was the original value of the currency. Over time, the term has been used to describe other investments, such as stocks, bonds, and commodities, which also have a nominal value.
Comparison Table
| Investment | Nominal Value | Real Value |
|---|---|---|
| Stock | $10 | $8.50 |
| Bond | $100 | $90 |
| Commodity | $50 | $45 |
Summary
Nominal is a financial term used to describe the original value of a currency, commodity, or security. It is not adjusted for inflation or other external factors, and is often used to compare different investments or to compare the same investment over time. For more information on nominal values, you can visit websites such as Investopedia, The Balance, and Investing.com.
See Also
- Real Value
- Inflation
- Interest Rate
- Market Value
- Exchange Rate
- Gross Domestic Product (GDP)
- Consumer Price Index (CPI)
- Gross National Product (GNP)
- Producer Price Index (PPI)
- Purchasing Power Parity (PPP)
